(New York) The New York Stock Exchange ended another crazy week down on Friday, unable to find any semblance of momentum heading into the weekend and handicapped by a poor US macroeconomic indicator.
Updated yesterday at 5:41 p.m.
The Dow Jones lost 0.69%, the NASDAQ index, with strong technological coloring, dropped 2.18%, and the broader S&P 500 index, 1.30%.
The session had started in a climate of optimism, Wall Street being encouraged by the “positive progress” towards a diplomatic solution to the conflict between Russia and Ukraine, mentioned by Russian President Vladimir Putin.
But the mood darkened as the day progressed, especially after US Vice President Kamala Harris regretted that the Russian head of state “shows no signs of commitment to serious diplomacy”.
Fighting continued on the ground and Russian troops continued to target several major cities in the country, including Kyiv, which they seek to encircle.
“Reports that Russia is stepping up its invasion have dampened enthusiasm” among investors, Schwab analysts noted in a note.
“Nobody wants to take risks before the weekend,” commented Karl Haeling of LBBW bank, with the prospect of possible new developments in Ukraine while the market is closed.
On the bond market, the rate of two-year US government bonds rose to 1.76% for the first time in 30 months.
The yield curve is flattening more and more (short-term rates are moving closer to long-term rates), a sign that the market is preparing for a cycle of hikes by the American Central Bank (Fed) but is not convinced by the strength of long-term growth.
“The bond market seems to be more focused on high inflation and the Fed rate hike, while the equity market is more interested in Ukraine,” noted Karl Haeling.
However, despite the jolts experienced by the markets over the past two weeks, NASDAQ (-1.48%), S&P 500 (-0.50%) and Dow Jones (-0.56%) are only slightly in below their level of February 23, i.e. before the start of the invasion of Ukraine.
As often, with the return of risk aversion, growth stocks suffered, like Netflix (-4.61%), Tesla (-5.12%), or the cryptocurrency platform Coinbase (-7.46%).
The electric vehicle manufacturer Rivian slipped (-7.56% to 38.05 dollars) after announcing Thursday, after the stock market, that it planned to produce only 25,000 copies of its models, while analysts anticipated 40,000.
He brought with him his competitors Nikola (-5.53%) and Lucid (-5.33).
The group of software and remote computing (cloud) Oracle (1.53% to 77.82 dollars) benefited from encouraging growth forecasts.
Another difficult day for Chinese stocks listed on Wall Street, in particular for Yum China (-15.51% to 37.48 dollars), the group which controls the KFC, Taco Bell and Pizza Hut restaurants in China.
On Thursday, the US market regulator (SEC) ordered several Chinese companies, including Yum China, to comply with new legal accounting requirements, failing which they could be delisted by 2024.
None of the 248 Chinese groups listed in New York has so far complied with these obligations. Chinese e-commerce giants Alibaba (-6.68%), JD. com (-8.63%) or Pinduoduo (-10.15%) suffered the backlash of the regulator’s first salvo on Friday.
Toronto Stock Exchange makes third straight weekly gain
(Toronto) – The Toronto Stock Exchange’s flagship index closed lower on Friday, despite the release of a strong job market report for February, but still posted a third weekly gain in as many weeks as the war in Ukraine continued to fuel volatility and rising oil prices.
Greg Taylor, chief investment officer at Purpose Investments, attributed Friday’s pullback to some profit-taking activity heading into the weekend.
“There’s a lot of uncertainty about the peace talks or what’s going on with the situation between Russia and Ukraine, and then next week there’s the Fed meeting and everybody’s expect a 25 basis point (interest rate) hike,” he said in an interview.
The Toronto Stock Exchange’s S&P/TSX Composite Index started the session with a slight gain, but then continued to retreat, finally losing 119.87 points and ending the day with 21,461.83 points. However, it has accumulated a progression of 59 points over the week as a whole.
A significant gap has recently widened between the Toronto market, which has shown growth of 1.1% since the beginning of the year, and the American stock exchanges, which have accumulated declines of between 9% and 18% during the same period. .
The main cause of this difference is rising commodity prices and weakness in growth sectors, such as technology, which loom large in US markets.
After recent gains, Toronto’s materials sector lost ground on Friday, dropping 1.36% as the price of gold fell victim to profit-taking activity, Taylor said.
Gold fell US$15.40 to US$1,985.00 an ounce on the New York Commodity Exchange, and copper fell US$2.7 cents to $4.63 US the pound.
The TSX information technology sector also retreated, by 2.38%. Hut 8 Mining shares fell 8.0%, Lightspeed Commerce 7.3% and Shopify 1.9%.
Toronto’s real estate sector recorded the best advance, at 1.22%, while the energy group advanced 0.08%, encouraged by the price of oil.
Crude oil prices rose US$3.31 to US$109.33 a barrel in New York. Over the week as a whole, the price of black gold nevertheless lost 5.5%. For its part, the price of natural gas rose 9.4 US cents to US$4.73 per million BTU.
In the currency market, the Canadian dollar traded at an average rate of 78.49 US cents, up from 78.27 US cents the day before.
The loonie advanced after the publication of encouraging data on the domestic labor market. The economy added 337,000 jobs in February, Statistics Canada said, more than offsetting January’s loss of 200,000. The unemployment rate fell to 5.5% from 5.7% in February 2020, before the arrival of the COVID-19 pandemic.
The Canadian Press