Dow at new record high
Wall Street remains in good spirits
December 18, 2023, 10:49 p.m
Listen to article
This audio version was artificially generated. More info | Send feedback
The hope of falling interest rates in the new year is keeping US investors upbeat. However, initial doubts arise as to whether expectations might already be exaggerated. The Dow hits its next record high.
Wall Street ended trading at the start of the week with slight gains. He has Dow Jones Index another all-time high at 37,393 points. The S&P 500 and the Nasdaq Composite rose to new annual highs. The mood was further supported by the prospect of falling interest rates in 2024. Nevertheless, market observers warned that expectations had already run very far ahead of the central bankers’ projections.
The Dow Jones Index gained one point to 37,306 points, the S&P 500 rose by 0.5 percent and the Nasdaq Composite rose by 0.6 percent. There were 1,437 (Friday: 908) price winners seen on the Nyse, compared to 1,398 (1950) losers. 66 (84) titles closed unchanged.
Market expert Stephen Innes from SPI Asset Management expects risk appetite, fueled by the US Federal Reserve, to take a break for now. Fundstrat countered that equities were currently also being supported by purchases from fund managers who were concerned about the macroeconomic environment and were therefore overly defensive until recently. “If we think about the last two weeks of 2023, that tells us that there will be some degree of performance chasing until the end of the year,” said the financial market experts.
United States Steel bullish on takeover by Nippon Steel
The individual values jumped United States Steel up 26.1 percent to $49.59. The Japanese competitor Nippon Steel buys the US steel company for $14.1 billion or $55 per share in cash. The purchase price includes a surcharge of 40 percent to the closing price on Friday.
Apple fell 0.9 percent, weighed down by a Bloomberg report that more Chinese government agencies and state-backed companies have ordered employees not to bring Apple iPhones and other foreign devices to work. In addition, Apple is expected to stop sales of the newer versions of its smartwatch in the next few days. The group is preparing to comply with a decision by the US Commission on International Trade regarding possible patent infringement.
For the Amazon stock it went up by 2.7 percent. According to sources, the group is in discussions about investing in the largest regional sports program provider in the USA, Diamond Sports. This would further advance the company’s push into the sports content sector, where it competes with streaming competitors such as Disney and Netflix.
Adobe gained 2.5 percent. The company has canceled its planned $20 billion acquisition of Figma. IBM (plus 0.3 percent) is benefiting slightly from Software AG selling two key business areas to the IT giant for a total of 2.13 billion euros following its takeover by financial investor Silver Lake.
Oil prices are rising significantly
The political tensions in the Middle East and especially the recent attacks on ships in the Red Sea drove up oil prices. In addition, according to a report by Reuters, Russia announced that it would further reduce its oil exports in December. The quotes for Brent and WTI rose by up to 2.0 percent.
At the Bond market Yields recovered somewhat from recent levies. The 10-year yield rose 3.7 basis points to 3.95 percent, compared with nearly 5 percent in mid-October. According to CME’s FedWatch, markets are 66 percent expecting the Federal Reserve to cut interest rates for the first time in March. Bank of America now expects interest rate cuts of 100 basis points next year, down from 75 basis points previously.
The dollar showed little change. The greenback could fall further through the end of the year after the Federal Reserve signaled it is considering cutting interest rates next year, according to MUFG currency analyst Lee Hardman. With the ECB and Bank of England still reluctant to talk about rate cuts, there is a “window for dollar sales until the end of the year.” However, the “weak global growth outlook” continues to be supportive for the dollar, which is expected to recover in the first quarter. The Gold price recorded a slight increase. The troy ounce rose by 0.3 percent to 2027 dollars. This meant that the precious metal was able to move slightly away from the $2,000 mark.