(New York) The New York Stock Exchange ended lower on Monday, dragged down by technology, as the Dow Jones tried to stabilize in a weak market, after several sessions of decline.
The Dow Jones index, up much of the session, lost 0.04% to 33,714.71 points. The technology-dominated NASDAQ lost 1.16% to 13,335.78 points and the broader S&P 500 index dropped 0.45% to 4,328.82 points.
For Peter Cardillo, an analyst at Spartan Capital Securities, “the rebellion in Russia had very little impact on the market, because it did not last long”. “Nevertheless, it is a geopolitical factor that will remain unresolved for some time,” he added.
The leader of the Russian paramilitary group Wagner, Evguéni Prigojine, author of an abortive mutiny which lasted 24 hours from Friday evening, had promised to “liberate the Russian people” by targeting in particular the Russian Minister of Defense Sergei Shoigu and the Russian Chief of Staff Valéri Guérassimov, whom he accuses of having sacrificed thousands of men in Ukraine.
Mr. Prigojine put an end to his rebellion on Saturday evening, in exchange for immunity for himself and his men.
According to Schaeffer’s Laura McCandless, this brief rebellion in Russia “remained on the minds of investors” on Monday.
The trading volume was low, in the absence of important indicators.
On the other hand, on Wednesday, investors will watch for the words of the president of the American central bank (Fed), Jerome Powell, who will speak at the forum organized by the European Central Bank (ECB) in Sintra, Portugal. Mr. Powell will also speak in Spain on Thursday.
On the macro news side, U.S. consumer confidence will be gauged on Tuesday for the month of June, ahead of the release of the Fed’s preferred gauge of inflation, the PCE index, which will be unveiled on Friday. for the month of May.
The markets will also have an indication of the momentum of the consumer, the engine of American growth, with the evolution of income and especially household spending for May.
In terms of values, a large half of the 11 sectors ended in the green, starting with the real estate sector (+2.21%) and energy (+1.71%), while oil prices ended slightly in the green attentive to the geopolitical situation with Russia.
Tesla stock darkened NASDAQ’s mood. Degraded by Goldman Sachs, the title fell 6.06% to 241.05 dollars.
Most of the big names in the technology sector followed lower, from Alphabet (Google, -3.19%) also poorly rated by a bank, to Meta (Facebook, -3.55%). Microsoft and Netflix dropped almost 2%.
Nvidia, the darling of the artificial intelligence (AI) sector, also ended in sharp decline (-3.74% to 406.32 dollars).
IBM, on the other hand, gained 1.48% to 131.34 dollars, after announcing its intention to buy the software company Apptio specializing in the cloud (remote computing) and AI for 4.6 billion dollars.
Vaccine maker Moderna climbed 1.61% to $120.41, benefiting from a better appreciation of the group’s valuation potential by UBS bank.
The Pfizer laboratory on the other hand fell by 3.68%, while the group announced the cessation of the development of an experimental drug against obesity, lotiglipron, which seems to have a bad effect on the liver.
Regional banks held up well, led by PacWest (+4.01% to 7.52%), sought after selling a $3.5 billion loan portfolio to Ares Management. Western alliance gained 2.14% and Zions 1.80%.
On the bond market, yields on ten-year Treasury bills were very slightly down at 3.72% against 3.73% the day before.
The Toronto Stock Exchange
The strength of the energy sector allowed the benchmark index of the Toronto Stock Exchange to close Monday up more than 100 points, while the major American indices ended the session in the red.
The Toronto floor’s S&P/TSX Composite Index climbed 169.09 points to 19,587.32 points.
While activity was relatively sluggish on Monday, heading into next week’s long weekend, all eyes will be on Tuesday’s release of the latest inflation data, said Kevin Headland, strategist Chief Investment Officer at Manulife Investment Management.
“It seems the consensus is that it’s going to be significantly lower, at least as far as the consumer price index is concerned,” noted Headland.
Statistics Canada is set to release its Consumer Price Index report for May on Tuesday, providing the most recent inflation reading — and the last ahead of the Bank of Canada’s next rate decision. interest, July 12. The Bank of Montreal expects annual inflation in Canada to have fallen a full percentage point to 3.4% in May.
If the forecast turns out to be correct, Headland said it could generate some optimism that the Bank of Canada will hold its key rate next month, rather than raise it again.
“There will be, I suppose, a wait-and-see approach,” he said.
“This may just be a signal that the Bank of Canada can resume its pause. Right now it’s a bit of a heads or tails game. »
Earlier this month, the Bank of Canada raised its rate by a quarter of a percentage point, to 4.75%, its highest level since 2001.
“I think the TSX was probably a bit surprised that the Bank of Canada decided to do another rate hike at the last meeting,” Headland said, noting that markets could also react if the forecasts of an impending recession would prove true within the next six months.
Headland noted that the lack of activity south of the border was likely a response to uncertainty surrounding the direction of the U.S. Federal Reserve, which held its rate steady this month.
“It looks like there’s a near (75%) chance that the Federal Reserve will make another rate hike, but actually (next move is) a month away, so there’s still a lot of information to be obtained before this date. »
In the currency market, the Canadian dollar traded at an average rate of 76.04 cents US, up from 75.76 cents US on Friday.
On the New York Commodity Exchange, crude oil rose 21 cents US to US$69.37 a barrel, while natural gas rose 5 cents US to US$2.89 a million. of BTUs.
The price of gold rose US$4.20 to US$1933.80 an ounce and that of copper depreciated 1 cent US to US$3.80 a pound.
The Canadian Press