(New York) The New York Stock Exchange opened lower on Friday, stunned by a much higher than expected US job creation figure, which revived fears of a tightening of the US central bank (Fed), against a background disappointing company results.
Around 9:55 am (Eastern time), the Dow Jones yielded 0.28%, the NASDAQ index dropped 0.72% and the broader S&P 500 index lost 0.61%.
The New York market was in the wrong direction before the opening, scalded by a series of disappointments from big names on Wall Street, from Apple to Starbucks.
But the market really tipped with the publication of the monthly employment report by the US Department of Labor, which reported 517,000 job creations in June, almost triple what economists expected (187 000).
The unemployment rate fell to 3.4% (from 3.5% previously), its lowest level since 1969.
“With this report, the market is questioning its certainty that the Fed will lower rates by the end of the year,” commented Patrick O’Hare of Briefing.com in a note, “because these figures could lead the Fed to wonder about the advisability of ending its monetary tightening soon. »
Thus, for the first time in several weeks, operators are now favoring cumulative increases of at least half a point by June, against a quarter of a point so far.
The earthquake was clearly felt on the bond market, with a sharp tension in rates. The yield on 2-year government bonds, more representative of monetary policy expectations than the 10-year rate, jumped to 4.22% from 4.10% on Thursday at the close.
“These very high employment figures combined with weaker than expected results from technology companies are generating a lot of uncertainty for investors,” said Adam Sarhan of 50 Park Investments.
“It will put the Fed back in a waiting position,” explains the manager, “and the market does not like uncertainty. »
The three tech giants that released their quarterly results on Thursday after trading all posted net profit below analysts’ forecasts.
Amazon’s chief financial officer (-5.22% to $107.02), Brian Olsavsky, said he expected “more moderate growth in the coming quarters”, referring in particular to the remote computing business ( cloud), which has been driving the performance of the Seattle group for several years.
Alphabet (-2.71% to 105.85 dollars) suffered from the darkening of the online advertising market, which reduced its turnover in this branch, the main group, in the fourth quarter, the YouTube video platform (-7.7%) being particularly affected.
Apple (+ 1.91% to 153.70 dollars) put its failure in the last three months of 2022 on the account of disruptions in its main iPhone assembly plant, in Shengzhou (China), due to a resurgence of coronavirus cases in November and December, but said he was confident in his 2023 outlook.
In addition, the Apple firm is the only one of the four technological behemoths not to have announced job cuts, recalled Dan Ives of Wedbush Securities, who sees Apple benefiting from the economic rebound in China.
Elsewhere in the tech sector, semiconductor maker Qualcomm (-1.17% to $308.06) also missed the target last quarter, and expects an even steeper deceleration at the start of the year.
But the disappointments were not limited to the technology sector.
Ford was penalized (-7.65% to 13.23 dollars) for its quarterly results below expectations, penalized by supply problems and cost increases. The manufacturer has warned that its 2023 accounts could be affected by a recession.
As for the Starbucks coffee chain (-4.23% to 104.53 dollars), it certainly achieved record sales in the first quarter of its staggered fiscal year (October to December), but below analysts’ projections. .
The Nordstrom department store chain took off (+21.52% to 25.69 dollars) after the Wall Street Journal revealed that investor and entrepreneur Ryan Cohen had taken a “significant” stake in the capital of the company.