Monday, July 26th 2021
Dow Jones continues over 35,000
Wall Street continues record hunt
At the end of last week, good corporate figures were causing record highs on Wall Street. The leading indices are now continuing their record hunt with new all-time highs. Quarterly reports from technology giants such as Alphabet, Amazon, Apple, Facebook and Microsoft could provide further boost.
The prospect of strong corporate balance sheets attracts more investors to Wall Street. However, further price falls in US stocks of Chinese companies dampened the buying mood. the Dow Jones-Index closed 0.2 percent higher at 35,144 points, the S&P 500 also increased by 0.2 percent (4422 points). The Nasdaq composite, meanwhile, was almost unchanged at 14,840 points.
Investors shouldn’t expect too much tailwind for the overall market from the business figures, warned economist Oliver Jones from the research house Capital Economics. Positive surprises are difficult because of the high expectations. Stockbrokers were eagerly awaiting the quarterly results of the electric car manufacturer Tesla, whose shares gained 3.7 percent. “You will certainly set the tone for the technology industry in the current week, predicts Naeem Aslam, chief market analyst at the brokerage house AvaTrade. On Tuesday, Apple, Microsoft and Google parent Alphabet, among others, will open their books.
Meanwhile, new panic sales broke the titles of Chinese tutoring schools Gaotu, Tal and New Oriental Education Exchange rate losses of up to 33 percent. The government’s ban on weekend and vacation courses hits companies particularly hard because they generate 80 percent of sales, the analysts from Goldman Sachs stated. In addition, companies must give up their pursuit of profit and become non-profit. The high fees for the tutoring lessons are a thorn in the side of the government in Beijing. They are seen as an obstacle to the desired higher birth rate. The industry had so far an annual turnover of 120 billion dollars.
Chinese technology companies such as the online retailer also came under pressure to sell Alibaba and the search engine operator Baiduwhose shares lost up to seven percent. The Chinese authorities are also tightening the thumbscrews in this industry. The government banned the technology group Tencent from having exclusive contracts for its music streaming service Tencent Music complete. Its US-listed papers collapsed by three percent.
At the same time, investors broke out Bitcoinafter a British newspaper reported that the online retailer Amazon could soon accept cryptocurrencies as a means of payment. Bitcoin then peaked by a good 21 percent to a six-week high of $ 39,778.95.
“The cops are back and apparently with power,” said Naeem Aslam, chief market analyst at brokerage firm Avatrade. On the stock exchange, the bull symbolizes optimism. The US appeared to have fewer reservations about cryptocurrencies than it did a few years ago, Aslam added. Therefore, the approval of a listed Bitcoin fund (ETF) by the US regulatory authority SEC is more likely.
Against this background, investors courageously took hold of stocks from the cryptocurrency sector and companies that deal with the blockchain technology on which Bitcoin & Co is based. The papers of Coinbase, Riot, Marathon and Silvergate gained up to 21 percent on Wall Street. The software company Microstrategy, which has invested billions in Bitcoin, also saw double-digit price gains. Amazon-Shares gained 1.1 percent.
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