(New York) The New York Stock Exchange ended its first week of 2022 lower on Friday, with the NASDAQ technology-dominated index dipping into the red for the fourth session in a row, after a disappointing US jobs report in December.
According to final results at the close, the Dow Jones index remained close to equilibrium at 36,231.66 points (-0.01%). The NASDAQ fell 0.96% to 14,935.90 points and the S&P 500 dropped 0.41% to 4677.03 points.
The S & P / TSX Composite Index closed Friday’s session up 12.25 points to 21,084.45 points, but is down 138 points for the week as a whole.
Only 199,000 jobs were created in December in the United States, far from the 440,000 expected by economists
“Equities ended a mixed session, with major indices showing losses for the first week of 2022,” Schwab analysts noted. The NASDAQ dropped more than 4% for the week, while the Dow Jones is slightly negative. The S&P 500 lost more than 1.60%.
“The possibility that the Fed accelerates on the path of monetary tightening was the main catalyst for the weakness of equities,” they stressed, recalling the publication of the Fed minutes on Wednesday, which shook the markets. The members of the Central Bank’s Monetary Committee took an even stronger stance on inflation.
And on Friday, “another mixed report on jobs added to the gloom, as job growth in December seriously missed forecasts, even though the unemployment rate fell much more than expected,” said they added.
The unemployment rate has indeed fallen brilliantly to 3.9%, its lowest in almost two years, according to a survey by the Ministry of Labor which is based on households while that on job creation is done with companies.
These figures were also concerning, as they do not yet take into account the impact of the Omicron variant. The data was collected before the variant of the coronavirus spread in the country and forced a return to telecommuting, the cancellation of thousands of flights, or the closure of schools in some counties.
However, for many investors, underlined Patrick O’Hare of Briefing.com, the weakness of job creation should not make the Fed change its mind, as it prepares to raise interest rates in three months.
The wage hike in December, welcome for workers, also raised eyebrows in the market, which sees it as a new sign of inflation.
Hourly wages rose 0.6% last month, more than expected, bringing the year-over-year increase to 4.7%. However, this remains less than the rise in prices.
On Wednesday, the CPI inflation index in the United States will be watched by the markets.
Faced with these tensions, rates on 10-year Treasury bills rose sharply, reaching 1.78% in the day, a two-year high.
After Wall Street closed, they stabilized at 1.76%.
Big names from the NASDAQ, heckled since Wednesday by the minutes of the Fed continued their descent into negative territory like Tesla (-3.54% to 1026 dollars) or Netflix (-2.21% to 541 dollars).
Bank stocks, on the other hand, once again welcomed the prospect of a rise in interest rates, ie a more profitable environment for the banks. Bank of America took 2.18%, Wells Fargo 2.13% and Citigroup 1.34%.
Stocks in the traditional economy have performed better than those in technology such as the energy sector with ExxonMobil (+ 0.82%) or Chevron (+ 1.44%).
As quarterly results approach, telephone operator Verizon climbed 2.13%.
Boeing, heavyweights of the Dow Jones, took off 1.95% to 215.47 dollars after a new order of four 777 cargo planes by Atlas Air.
The sportsman Nike dropped 2.56% to 156.91 dollars as he files a lawsuit against Lululemon, claiming to protect his intellectual rights on digital technologies applied to sports, such as exercise mirrors. Lululemon also lost 3.68% to $ 355.21.
The action of the chain of video game stores Gamestop, darling of online punters, soared more than 7.33% to 140.64 dollars. Press reports indicate that GameStop will launch a division to develop a market for non-fungible tokens (NFTs), new types of digital assets, and establish partnerships in cryptocurrencies.
with The Canadian Press