(New York) The New York Stock Exchange moved in scattered order Monday at the start of a very busy week in economic news between the Fed meeting and the results of companies.
Posted at 9:44 a.m.
Updated at 10:20 a.m.
Around 10 a.m., the Dow Jones advanced 0.34%, the NASDAQ dropped 0.24% and the S&P 500 gleaned 0.13%.
Despite a decline in the indices on Friday – the first in four sessions – Wall Street had had a solid week, the Dow Jones concluding with a weekly increase of 2%, the S&P 500 of 2.55% and the NASDAQ of 3.33 %.
On Friday, the tumble in Snap shares (-40%) led to a decline in the NASDAQ (-1.87%) while the Dow Jones fell 0.43% and the broader S&P 500 index 0.93%.
“Stocks advanced last week on some optimism that earnings season might not be as bad as feared,” said Art Hogan of B. Riley Wealth Management.
He also pointed out that the prospects of weaker activity that companies could give could, in return, encourage the Central Bank to be less strict on rates in the future, a positive sign for equities.
“A less strong forecast could open the door to a change in attitude from the Fed and tempt investors to return to the market,” wrote the analyst.
The Central Bank meets its monetary committee from Tuesday and should announce Wednesday a further increase of 75 percentage points, according to the majority of operators.
But for one in five investors, a one-percentage-point hike was not out of the question, according to CME Group’s calculations, based on futures contracts.
“Market participants will no doubt pay close attention to remarks by Fed Chairman Jerome Powell for more details on the Central Bank’s plans” at his press conference on Wednesday, Wells Fargo analysts said. .
Recession?
On the bond market, rates on 10-year bonds remained below 3% at 2.81% against 2.75% on Friday. They remained lower than those for two years (3.01%), a sign generally seen as indicative of an upcoming recession.
The first estimate of US Gross Domestic Product (GDP) for the 2e quarter is expected for Thursday, when the world’s largest economy was already in contraction in the 1er quarter (-1.6%). Technically, an economy is considered in recession after two quarters of negative growth.
US Treasury Secretary Janet Yellen said on Sunday that while the US economy was slowing, economic data did not point to a recession.
“A recession is a generalized contraction that affects many sectors of the economy. We just don’t have that, “certified Joe Biden’s Minister of Economy and Finance, in an interview with NBC, highlighting in particular “the labor market (which) is now extremely solid” .
In terms of company results, the week was going to be intense with no less than 175 S&P 500 companies publishing their accounts. Tuesday, are expected in particular General Electric, UPS, 3 m, Coca-Cola and, after the closing, those of Alphabet (Google) and Microsoft.
The title Snap, parent company of the popular Snapchat application, stabilized around 10% (+1.50%) after its catastrophic fall on Friday following disappointing results, particularly in digital advertising.
Semiconductor manufacturers’ stocks were in the red like AMD -1.41%), Nvidia (-1.98%) or Intel (-0.87%) pending a vote by the US Senate to $50 billion in support for industry struggling with supply chain issues.