Friday, April 9th, 2021
Always higher, always further
Dow and S&P 500 hit new records
The financial markets still only know one direction. At the end of the week, the Dow Jones and S&P 500 climb to all-time highs despite rising corona case numbers worldwide. However, this is precisely where the oil price suffers.
The American stock markets rose again at the end of the week. Shortly before the closing bell, the prices picked up again significantly. The US Standard Values Index Dow Jones rose 0.9 points to a record high of 33,801 points. The broader one S&P 500 also reached an all-time high with an increase of 0.8 percent at 4128 points. The technology-heavy one Nasdaq increased by 0.5 percent. Dax and EuroStoxx50 had previously closed almost unchanged.
The surprisingly strong increase in US producer prices therefore did not have a negative impact. The US Federal Reserve has stated time and again in the recent past that price increases should prove to be temporary and that it will not take action against them.
At a panel discussion at the International Monetary Fund (IMF), US Federal Reserve Chairman Jerome Powell also affirmed that the Fed will not change its previous monetary policy for the foreseeable future. In addition, US President Joe Biden presented his first draft budget to Congress, which is of particular interest to stockbrokers because of the planned additional trillion-dollar economic aid.
Dollar stable, oil price under pressure
US producer prices rose more sharply than expected in March. They increased by 1.0 percent compared to the previous month, while economists had only expected an increase of 0.4 percent. In the core rate too – without the volatile prices for food and energy – the increase was stronger than forecast. It is said that the significantly higher gasoline prices are primarily responsible for the increase.
The stabilized on the foreign exchange market Dollar index, which reflects the exchange rate to major currencies, at the end of the week at 92.2 points. On the one hand, the prospect of a rapid normalization of the US economy supports the world’s leading currency, said Commerzbank analyst Antje Praefcke. On the other hand, the Fed’s announcement of an ultra-loose monetary policy in the longer term is a burden.
The oil price went down. The US variety WTI fell 0.3 percent to $ 59.40 a barrel (159 liters). According to experts, the rising number of coronavirus cases in some regions fueled the fear of lower demand. In addition, the return of Iranian oil to the world market must be expected if the nuclear talks with the Islamic Republic progressed and sanctions were eased, said analyst Helima Croft of the investment bank RBC Capital Markets.
Johnson & Johnson lose, Amazon win
In terms of individual values, the share went from Johnson & Johnson (J&J) down 1.1 percent. Due to the recently identified quality defects at a contract manufacturer, which made around 15 million doses of J & J’s corona vaccine unusable, the pharmaceutical company will deliver 80 percent fewer vaccine doses in the USA in the coming week than this one. In addition, the European Medicines Agency (EMA) is examining a possible connection between the J&J vaccine and thrombosis cases.
Boeing lost 1.0 percent. Just a few months before the 737 Max was re-registered, the aircraft manufacturer advised several airlines of a possible new problem with the aircraft’s electrical system.
Honeywell (+ 3.4%) benefited from some positive analyst comments. Among other things, Deutsche Bank has upgraded the share to “Buy”.
Amazon rose by 2.2 percent. A majority of the company’s employees at the Bessemer site in Alabama voted against the formation of a union.
Levi Strauss gained 2.6 percent. The jeans manufacturer had presented better quarterly figures than expected and was optimistic about the current second quarter.
Mining company Turquoise on the rise
At the company advanced Turquoise Hill into the spotlight. The US-listed shares of the Canadian mining company rose 3.0 percent after the company and its mother Rio Tinto agreed on financing to expand the “Oyu Tolgoi” mine in Mongolia. One of the world’s largest known gold and copper deposits is located there. Exploding costs had sparked a dispute between Rio Tinto and Turquoise Hill.
The titles of Lucira gained 2.8 percent. According to the information, a corona test by the medical technology company detects at least 99.9 percent of all coronavirus variants, including the “double mutant” from India. Advances in the development of a drug to treat coronavirus patients earned shares of RedHill Biopharma a price increase of 8.3 percent. According to the information, an independent panel of experts was unanimously in favor of continuing the tests with the agent.
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