(New York) The New York Stock Exchange ended higher on Friday, boosted by the decline in bond yields, themselves influenced by expectations of a rate cut by the Fed (American central bank) from the first quarter of 2024 .
The Dow Jones rose 0.82%, the NASDAQ index gained 0.55% and the broader S&P 500 index advanced 0.59%.
Starting in the red, Wall Street’s flagship indices recovered throughout the session, allowing the S&P 500 to record a fifth positive week in a row.
“It’s a combination of factors,” CFRA’s Sam Stovall said of the turnaround, “but it’s mostly due to the continued easing of bond yields.” »
The yield on 2-year US government bonds, considered the most representative of market expectations in terms of monetary policy, tumbled to 4.53%, compared to 4.68% at Thursday’s close, the lowest since five and a half months.
Operators are now counting on a first cut in the Fed’s key rate as early as March, a scenario largely ruled out just a week ago.
This posture is linked to increasingly clear signs of an economic slowdown in the United States and a continued deceleration of inflation.
The picture was confirmed on Friday by the ISM index, which highlighted a contraction in activity in the manufacturing sector in November. The index stood at 46.7% (a figure below 50 indicates a decline in activity), unchanged from the previous month, while economists expected a rebound, to 47.8%.
The New York market ignored the statements of Fed President Jerome Powell, who nevertheless considered, on Friday, “premature” to “speculate on the moment when monetary policy could be relaxed”, during an intervention at Atlanta (Georgia).
Sam Stovall points out that historically, stocks tend to perform well during periods ranging from the end of a tightening cycle to a first rate cut.
“There are many elements likely to fuel investor confidence,” according to him.
Generally speaking, this wind of optimism benefited a number of volatile stocks, notably Airbnb (+6.87%), Lyft (+12.02%) and Peloton (+9.89%).
In the same momentum, representatives of the cryptocurrency sector, such as “miners” Marathon Digital Holdings (+14.45%) and Riot Platforms (+9.72%) were swept along.
Elsewhere, Tesla reversed course (-0.52%) the day after the presentation, with fanfare, of a new electric pick-up, the Cybertruck, with futuristic lines. A Morningstar analyst estimated that the base model’s selling price of US$60,990 positioned the vehicle in the high-end market and not in the mainstream market.
In contrast, Ford, whose competitor, the F-150 Lightning, is sold for US$50,000, had a successful session (+3.12%), as did the electric vehicle manufacturer Rivian (+7.58 %).
Paramount Global was sought after (+9.81%) after the Wall Street Journal reported that the media group was considering an offer bringing together its streaming Paramount+ and Apple’s (+0.68%), Apple TV+, at a lower price than the two separate subscriptions.
Pfizer was sanctioned (-5.12%) after stopping clinical trials of its two-daily anti-obesity pill danuglipron. The results showed a high proportion of unwanted side effects during the last wave of tests. The laboratory nevertheless decided to continue testing the version at a daily dose.
The computer equipment manufacturer Dell Technologies slipped (-5.19%) after reporting, Thursday after the market, a quarterly turnover lower than analysts’ projections. The Round Rock (Texas) group recorded a slowdown in all its branches, including servers and data storage.
Toronto closes with a gain of more than 200 points
The Toronto Stock Exchange gained more than 200 points Friday on broad strength in base metals, industrials and telecommunications, while U.S. markets also advanced.
The S&P/TSX composite index on the Toronto floor gained 216.58 points, or 1.07%, to end the session with 20,452.87 points.
On the currency market, the Canadian dollar traded at an average rate of 74.04 US cents, up from 73.63 US cents on Thursday.
On the New York Mercantile Exchange, crude oil prices fell US$1.89 to US$74.07 per barrel, while natural gas prices rose US$1 cent to US$2.81 per barrel. million BTUs.
The price of gold rose US$32.50 to US$2,089.70 per ounce and copper rose 8 US cents to US$3.93 per pound.
The Canadian Press