Dow with weekly plus
US stock exchanges on the hunt for records again
January 19, 2024, 10:55 p.m
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The US stock markets are once again rising to highs. Positive quarterly figures and optimistic profit prospects from some large companies, including those in the technology sector, are causing investors to become increasingly interested in buying.
Driven by technology stocks, Wall Street rose sharply at the end of the week. The sector was further supported by the convincing quarterly figures from the Taiwanese chip manufacturer TSMC. In addition to the Nasdaq-100, the Dow Jones Index and the S&P 500 also climbed to new all-time highs. In addition, there was further increasing economic optimism with hopes of a soft landing for the US economy. This was partly fueled by new US economic data.
According to market participants, the agreement reached late on Thursday in the budget dispute, which initially averted a shutdown, i.e. the closure of authorities and other state institutions, also contributed to the positive mood.
The Dow Jones Index gained 1.1 percent to 37,864 points. The S&P 500 improved by 1.2 percent. For the Nasdaq Composite it went up 1.7 percent. The 1910 (Thursday: 1572) price winners were compared to 918 (1243) losers. 84 (93) titles closed unchanged.
Consumer sentiment better than expected
Stock prices had already been lifted by economic optimism on Thursday. Contrary to expectations, the number of initial applications for unemployment assistance fell significantly. According to US data released on Friday, US consumer sentiment improved in January. The index calculated at the University of Michigan rose to 78.8, while economists had only expected a level of 70.2. In the survey at the end of December, the index was 69.7.
Sales of existing homes, however, fell to their lowest level in 28 years in December. The data from the real estate market is also seen as a kind of indicator of US consumers’ willingness to spend. Private consumption accounts for around two thirds of the US economic output
Bond yields gave up temporary gains. The yield on ten-year papers fell by 0.7 basis point to 4.14 percent. Market participants explained the increase with the dwindling hope that the US Federal Reserve would soon cut interest rates. On Thursday, Atlanta Federal Reserve President Raphael Bostic said he believed a rate cut before the third quarter was unlikely.
Chip values with significant markups
In the technology sector, chip stocks were particularly sought after. The corresponding sub-index in the S&P 500 clearly led the list of winners with an increase of 4.4 percent. For the shares of Texas Instruments, Intel, AMD and Nvidia it went up by up to 7.1 percent.
The insurer’s business figures were also very good Travelers included, who earned significantly more than expected in the fourth quarter. This was largely due to lower levels of damage from natural catastrophes. The share price rose by 6.7 percent.
Next to it was the department store chain Macy’s with planned job cuts in mind. The company is expected to lose 2,350 jobs; that would be 3.5 percent of the employees. The share fell by 1.7 percent.
Falling against it Irobot by 27.9 percent. According to a report in the Wall Street Journal, the EU wants to block Amazon’s planned takeover of Irobot for $1.7 billion.
Dollars with taxes
The dollar weakened a bit. The dollar index fell 0.3 percent. After the budget dispute has been resolved, the US currency will likely be less in demand as a “safe haven,” it said.
Oil prices were somewhat lighter. The prices for Brent and WTI fell by 0.4 percent each. The prices were caught between geopolitical uncertainty such as the Middle East conflict and the still good supply situation, it was said in the trade.
The price of gold benefited from the weakening dollar. The troy ounce gained 0.3 percent to $2,029.