Wall Street rises on expectations of a more flexible Fed

Wall Street rises on expectations of a more flexible Fed

The New York Stock Exchange ended higher, with some investors betting on greater flexibility in the Federal Reserve (Fed) in its policy of raising rates, after several disappointing macroeconomic indicators.

The dow jones gained +0.45% to 33,912.44 points, the technological nasdaq rose +0.62% to 13,128.05 and the S&P 500 advanced +0.40% to 4,297.14 units.

wall street opened lower after a series of bad macroeconomic data.

In Chinaindustrial production and retail sales fell in June, while investment fell in July.

Furthermore, in the United States the manufacturing activity of the area of New York August registers its steepest decline since April 2020, according to the Empire State index published this Monday by the Fed.

The index fell 42 points to -31.3, registering its second largest drop since the survey began and reaching one of the lowest levels in its history, according to the survey of manufacturers in the region. Activity is considered to be contracting when the index is less than zero.

But investors saw in these negative data a support to their hope that the fed be more flexible than expected with your monetary adjustment.

“The Fed will stop before (raising its guideline rates) if inflation subsides, and it is more likely that (the rise in prices) will subside if the world economy moderates” its growth, explained Chris Low of FHN Financial.

This Monday the defensive values, those that depend less on the situation, were the most sought after, such as Coke (+1.26%), McDonald’s (+1.24%) or Comcast (+1.42%).

The day was animated by the announcement of the entry into the capital of Disney (+2.21% to $124.26), from the investment firm Third Pointfor about 1,000 million dollars, according to a source close to the negotiations.

The laboratory modernhit last week, recovered on Monday (+3.27% to $176.78), helped by the authorization of British regulators to market its new anti-covid vaccine specific for the Omicron variant of Covid-19.

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