(New York) The New York Stock Exchange ended on a mixed note Thursday, the good performance of the US economy outweighing the prospect of continued monetary tightening, which sent bond yields soaring.
Unlike the trend observed since the beginning of the year, the Dow Jones held its own and gained 0.80%, while the NASDAQ index, usually the locomotive of Wall Street, ended in equilibrium . The S&P 500 index gained 0.45%.
The session had started in the red after the publication of several indicators stronger than expected.
US gross domestic product (GDP) was revised up to 2.0% for the first quarter year-on-year from 1.3% initially reported, while weekly new jobless claims posted their biggest drop in a year. week since 2021.
This data “reinforces the likelihood that the US central bank (Fed) will remain considerably more aggressive than investors expect,” commented Jose Torres of Interactive Brokers.
Traders now attribute a probability of more than 40% to the hypothesis of two more rate hikes from the Fed by November.
The bond market was shaken by these indicators. The yield on 2-year US government bonds rose to 4.89%, the highest in almost four months.
This brutal tension penalized stocks in the technology sector, whose strong growth depends on financing conditions.
Amazon (-0.88%), Nvidia (-0.72%) and Meta (-1.32%) all took a step back.
However, the equity market as a whole ended up recovering.
It owes it in large part to the banking sector, supported by the publication, by the American central bank (Fed), of the results of annual resistance tests (stress tests), better than last year for all of the 23 main American banks. .
Goldman Sachs (+3.01%), Wells Fargo (+4.51%) or JPMorgan Chase (+3.49%) were all sought.
In their wake, regional or medium-sized banks also rose, like the Californian brand PacWest (+3.31%) or the Texan Comerica (+1.76%).
“It’s encouraging to see that even with (the jump in rates), the market is not retreating,” observed Tom Cahill of Ventura Wealth Management, for whom “investors are starting to get used to the idea that a soft landing of the economy is possible. »
In addition to the banks, certain values neglected in recent weeks have paraded, such as Caterpillar (+0.98%), Boeing (+0.53%) or Dow (+0.53%).
“We have a small rotation of growth stocks towards the industrial or banking sectors and others whose valuations are reasonable”, underlined Tom Cahill.
Space tourism company Virgin Galactic was the subject of profit taking (-10.76%) after its first successful commercial flight on Thursday, with the Italian Air Force as a client, a decisive step for the group founded almost twenty years ago.
The ghost BlackBerry advanced (+6.99%), after having doubled its revenues over one year thanks to a strategic repositioning which moved the group from smartphones to cybersecurity software in particular.
The electric car sector remained well oriented, after the bankruptcy filing of the American manufacturer Lordstown, Tuesday, which benefits its competitors, whether Tesla (+0.49%), Rivian (+9.36%) or Lucid (+7.17%).
United Airlines made a forced landing (-4.58%), forced by the cancellation of hundreds of flights for several days, which the airline attributed to personnel problems and a lack of air traffic controllers.
Toronto Stock Exchange
The Toronto Stock Exchange closed with a gain of nearly 100 points on Thursday, fueled by stocks in the energy and financial sectors, while the major US indices closed in mixed order.
The Toronto Stock Exchange’s S&P/TSX Composite Index gained 94.32 points to end the day with 19,913.17 points.
In the currency market, the Canadian dollar traded at an average rate of 75.44 cents US, down from 74.45 cents US on Wednesday.
The Canadian Press