Boeing is flying high: Dow closes in positive territory after a turbulent week

After the enormous losses on Monday, Wall Street turns significantly into profitability at the weekend. However, analysts do not want to attach too much importance to the recovery. Because the Corona crisis continues to cause uncertainty in the markets.

The US stock exchanges ended the last trading day of a stock market week marked by strong fluctuations with significant price gains. Hopes prevailed among investors that under the pressure of the expanding corona pandemic, Democrats and Republicans in the USA might agree on further support measures for the population and the economy.

After falling prices at the start of trading, the indices turned positive as the year progressed. Of the Dow Jones Index closed 1.3 percent higher at 27,174 points. Of the S&P 500 won 1.6 percent that Nasdaq Composite 2.3 percent.

At the moment, the rapidly increasing number of new corona infections in Europe and the associated risks for the global economy are particularly unsettling investors. In addition, there is the unresolved conflict between the USA and China and the increasingly fierce US presidential election campaign. At least there seems to be some movement in the recently faltering new government stimulus package for the ailing US economy.

The Democratic spokeswoman for the US House of Representatives, Nancy Pelosi, is to prepare a proposal in which the volume of the planned measures is slimmed down to 2.4 trillion dollars. This would meet the Republicans' demands for spending restrictions. The package is said to include aid to airlines, restaurants and small businesses, some of which are likely to have Republican approval.

Observers did not want to attach too much importance to weekend recovery. The volatility will continue until a vaccine against the virus is available, said David Coombs, head of multi-asset investments at Rathbone Brothers. Because without a vaccine, the course of the pandemic cannot be foreseen.

Vaccine study strengthens Novavax

Costco Wholesale lost 1.3 percent after presenting good business figures. Market participants pointed to profit-taking after the share gained almost 19 percent in the current year. The wholesale chain's sales rose 12.5 percent to $ 53.4 billion in the fourth fiscal quarter, the highest increase in the company's history. For the first time, the annual profit exceeded the mark of 4 billion US dollars. Costco apparently benefited from buying behavior in the Corona crisis. One downer was the corona-related increase in costs.

The biotech company Novavax has started a phase 3 study of a Covid-19 vaccine in the UK. As the US company announced, 10,000 people will take part in the study. The phase 3 study with the vaccine candidate could then begin in the United States in October with up to 30,000 test persons. Novavax also announced a collaboration with Endo to produce the vaccine. The Novavax share advanced 10.9 percent. Endo improved 8.4 percent.

Strongest value in the Dow Jones index were Boeing with plus 6.8 percent. The company announced an order from the US Air Force for the delivery of precision guided bombs (SDB) worth $ 2.24 billion on Thursday after the stock market closed.

The dispute over tax payments from Apple in Europe, however, continues – possibly for years: The EU Commission decided to take action against a court decision that had gone out in favor of Apple. Brussels is also of the opinion that Ireland has granted the iPhone manufacturer 13 billion euros in unjustified tax rebates for years. Apple shares rose 3.8 percent after Morgen Stanley had reiterated the buy recommendation for the stock. Investors should use the price losses to get started, it said. Technology stocks were generally in demand. The sector was the biggest winner with a plus of 3.6 percent.

Little movement in oil prices

That was on the foreign exchange market dollar with the ongoing uncertainties as a safe currency haven still in demand. The dollar index gained 0.3 percent. The fear of lockdowns weighed on the euro due to the increasing number of new corona infections. The common currency was trading at around $ 1.1630 versus 1.1672 on Friday morning.

The Oil prices were more or less on the spot. On the one hand, concerns about the global economy and the firm dollar weighed on prices, on the other hand, there was support from the recovery in the equity markets. The price of the barrel of the WTI variety fell 0.1 percent to $ 40.25, Brent lost 2 cents to $ 41.92.

Also on the Gold price the strong dollar continued to depress. The price of the troy ounce fell 0.3 percent to 1,863 dollars. US Treasuries were asked in view of the uncertainties. The ten-year yield fell by 1.3 basis points to 0.65 percent as prices rose.