(New York) The New York Stock Exchange fell slightly on Monday, penalized by the rise in interest rates which crossed a new threshold in 16 years, while a burst of technological results is expected this week.
The Dow Jones index, which had started deeper in the red, lost 0.11% around 10:20 a.m. (Eastern time). The NASDAQ, where technology stocks are concentrated, lost 0.06%. The broader S&P 500 index lost 0.08%.
Interest rates on ten-year Treasury bills briefly passed the 5% threshold at the start of the session, the highest level since 2007.
But an hour after the New York opening, they fell back to 4.90%.
Over the past week, bond yields have accelerated, in the face of better-than-expected American economic figures and geopolitical risks in the Middle East.
On Friday, “the markets closed their worst week of the month,” commented Art Hogan of B. Riley Wealth Management. The Dow Jones suffered its fourth weekly loss in five weeks, dropping 1.6%.
Over the week the Dow lost 1.6%, the S&P 500 slipped 2.4% and the NASDAQ fell 3.2% weekly. “He finished under 13,000 points for the first time since May 31,” noted Art Hogan.
For Edward Moya of Oanda, “with the ten-year yield passing 5% it is clear that the high rates” of the Fed “are going to remain high for a while”.
“The stock market may struggle today and there are a plethora of reasons for that,” commented Patrick O’Hare of Briefing.com.
“Israel intensifies airstrikes against Hamas and New York Times reported that Israel is facing an increase in Hezbollah attacks from Lebanon,” the analyst adds.
More than 19,000 people have been displaced in Lebanon after an intensification of clashes between the Israeli army and Lebanese Hezbollah on the border between the two countries, according to figures published Monday by a specialized United Nations agency.
On the stock market, the oil group Chevron lost 2.68% after announcing it would buy its compatriot Hess, a gas and oil producer, for $53 billion. Hess Corporation gained 1.40%.
With this operation, Chevron gets its hands on Hess’s positions in the “Stabroek” offshore oil block off the coast of Guyana, a small South American country which has the world’s largest reserves of crude oil per capita.
This megaoperation comes less than two weeks after the announcement of the acquisition of Pioneer by ExxonMobil for $60 billion.
Apple lost 1.05% after reports that one of its suppliers Foxconn is facing a tax inspection from Chinese authorities. The Taiwanese technology giant confirmed on Sunday that it was the subject of investigations in China and assured “cooperation” with the authorities.
Later in the week, the technology sector will be in the spotlight with quarterly announcements from Microsoft and Alphabet on Tuesday, Meta on Wednesday and Intel and Amazon on Friday.
Meanwhile, in this most intense earnings week of the season, General Motors, General Electric, Kimberly Clark, Coca-Cola and 3m are expected as early as Tuesday.
Elsewhere on the stock market, the Walgreens pharmacy chain gained more than 3% after a good rating from JPMorgan.
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