(New York) Wall Street could not maintain its rebound on Thursday and concluded on a sharp decline, weighed down by the technology sector again, as investors digested new data on employment and inflation.
Updated yesterday at 4:29 p.m.
According to final results at the close, the Dow Jones index dropped 0.49% to 36,113.62 points. The NASDAQ, where technology stocks are concentrated, fell 2.51% to 14,806.81 points and the S&P 500 fell 1.42% to 4,659.23 points.
The Toronto Stock Exchange’s S&P/TSX Composite Index fell 102.04 points to end the day at 21,292.96 points.
Toronto’s tech sector fell 2.7% on Thursday, with Shopify’s stock plunging 8.8% in particular.
The Materials and Energy sectors lost ground as prices for metals, crude oil and natural gas declined.
On the New York Commodity Exchange, crude oil fell 52 cents US to US$82.12 a barrel, while natural gas fell 58.7 cents US to 4.27 US$ per million BTUs.
The price of gold fell US$5.90 to US$1821.40 an ounce and that of copper fell 3.1 cents US to end near US$4.55 a pound.
In the currency market, the Canadian dollar traded at an average rate of 80.10 US cents, up from 79.94 US cents the previous day.
“Investors scrutinized mixed economic data which showed that while producer prices moderated more than expected month on month (+0.2%), they remained very high year on year (+9, 7%)”, noted the Schwab analysts.
“Additionally, unemployment claims unexpectedly increased for a second consecutive week, likely due to the impact of the festering spread of the 0-micron variant, but slipping claims remain in a downward trend,” they said. they noted.
From January 2 to 8, 230,000 people registered as unemployed to receive an allowance, 23,000 more than the previous week.
This slight rise reflects the impact of the Omicron variant, “which should not last”, according to analysts at HFE.
On a four-week shift, jobless claims remain down.
This shows that the labor market remains tight, a factor that could still weigh on inflation in the future, which cooled investors as the US Central Bank (Fed) says it is ready to bring down inflation in raising rates in three months.
Before a Senate committee, Lael Brainard, the future number two at the Fed, said she was “very concerned about the high level of inflation”.
“We hear from working families across the country talking about inflation […] We have a powerful tool and we will use it,” she said.
Sensitive to inflation fears, the tech sector once again faltered, including big names like Amazon (-2.42% to $3,224.28), Apple (-1.90%, $172.19 ), Facebook (-2.03%, $326.48) and Netflix (-3.35%).
Electric carmaker Tesla fell 6.75%, while Ford stock had a great day, climbing more than 5% in the session before ending up 2.25% at $25.02.
Ford, which is betting big on electrics in the future, surpassed $100 billion in market capitalization for the first time, overtaking rival General Motors. However, it remains far behind Tesla, whose stock market value exceeds 1000 billion dollars.
New to Wall Street, the private equity fund TPG has successfully completed its first major IPO at the start of the year.
The company, listed on the stock exchange at a price of 29.50 dollars per share, or a valuation of more than 9 billion dollars, ended its first day of trading up 15.25% to 34 dollars.
Based in Forth Worth (Texas), TPG, which raised a billion dollars in the operation, is one of the last investment groups to settle on the stock market after Blackstone, KKR or Carlyle. The company manages $109 billion in assets.
Delta Airlines (+2.17% to 41.29 dollars) opened the earnings season, after a difficult quarter under the effect of the Omicron variant which led to the cancellation of tens of thousands of flights.
But the airline declared itself optimistic for the whole of 2022, even if Omicron will still delay “by two months”, according to Delta, the recovery of the airline sector.
Shares of United Airlines (+3.50%) and American Airlines (+4.54%) benefited from the momentum.
Boeing climbed 2.91% to $223.78 amid news reports that the 737 MAX, which was grounded globally in 2019 after crashes, could return to service in China.
Yields on 10-year Treasury bills fell sharply to 1.69% from 1.74% the previous day.