(New York) Wall Street closed mixed on Thursday on profit-taking, while good news on the inflation front in the United States prompted investors to rotate their investments.
The Dow Jones Industrial Average remained positive, gaining 0.08% to 39,753.75 points. The NASDAQ, which had piled up seven records in a row thanks to large caps, fell 1.95% to 18,283.41 points. The S&P 500 also moved away from its peak of the day before, losing 0.88% to 5,584.54 points.
On the bond market, ten-year rates fell around 4:32 p.m. (Eastern time) to 4.20% against 4.28% on Wednesday.
Short-term two-year rates, even more sensitive to changes in the daily rates of the American central bank (Fed), slipped even faster to 4.50% against 4.62%.
Inflation in the United States, as measured by the consumer price index (CPI), slowed more than expected in June, to 3% year-on-year compared to 3.3% the previous month and 3.1% expected.
Over one month, prices fell by 0.1%, while they were still growing slightly in May. This is the first time since 2020 that inflation has fallen over a month.
“The decline in consumer prices […] will strengthen the case for the Fed to start cutting interest rates in September, especially if the jobs market also slows,” said Ryan Sweet, chief economist at Oxford Economics.
Investors rotated their investments, which favored the Russell 2000 (+3.69%), the index grouping 2000 SMEs listed on the stock exchange which had been shunned until now, to the detriment of the NASDAQ, which has been very popular recently.
“We are seeing a rotation away from the large caps and the semiconductor sector that have led the way so far, towards lagging sectors like small and mid caps,” Adam Sarhan, an analyst at 50 Park Investment, told AFP.
The rotation was driven by “profit-taking after the tech sector’s surge,” he added.
All the major technology capitalizations have lost ground, like the market favorite, Nvidia (-5.57%), but also Amazon (-2.37%), Apple (-2.32%) and Intel (-3.93%).
The most spectacular fall was that of Tesla (-8.44%).
The electric vehicle manufacturer intends to delay until October the launch of its robotaxi, a driverless vehicle, which had been announced for early August, according to press reports.
The launch is seen as the start of a new chapter in the automaker’s history of autonomous driving. But Elon Musk’s group appears to need two more months to produce prototypes.
Elsewhere in the stock market, Delta Air Lines slid 3.99% after second-quarter profit fell 29% despite record quarterly sales.
The 7% increase in turnover was offset by an increase in operating costs, fuel prices and wages.
Helping the Dow Jones to keep its head above water, the shares of distribution giants, comforted by lower inflation which should reassure consumers, took off, such as the DIY chain Home Depot (+2.79%), or McDonald’s (+1.72%).
TSX rises nearly 200 points
Canada’s main stock index rose nearly 200 points Thursday, helped by strength in the telecommunications, utilities and energy sectors, while U.S. stock markets closed mixed.
The S&P/TSX composite index rose 193.90 points to 22,544.13.
The Canadian dollar was trading at 73.40 cents US compared to 73.42 cents US on Wednesday.
Oil rose 52 cents to $82.62 per barrel and natural gas fell six cents to $2.27 per million BTU.
Gold rose $42.20 to $2,421.90 an ounce and copper fell ten cents to $4.51 a pound.
The Canadian Press