Wednesday 07 July 2021
Fed minutes at a glance
The hunt for records continues on Wall Street
The US stock exchanges posted moderate gains in the middle of the week. Initially, investors favored technology stocks, but the other New York indices ultimately still outperform the tech index. The continued fall in capital market interest rates also contributed to the positive investor sentiment.
Wall Street has continued its record hunt. While in the run-up to the Fed protocol it was still changing due to nervousness, the slight gains stabilized afterwards. The S&P 500 and the Nasdaq Composite hit new all-time highs. The Dow Jones index rose 0.3 percent to 34,682 points, the S&P 500 also gained 0.3 percent, while the Nasdaq composite gained only one point. 1,587 (Tuesday: 1,142) course winners and 1,716 (2,214) losers were seen. 135 (107) titles closed unchanged.
The Fed Protocol did not produce too many surprises, but it did remove the uncertainty that was felt beforehand. At their council meeting on June 15 and 16, the US central bankers discussed whether and when the Federal Reserve would begin reducing its stimulus for the economy. Participants said they may have to shut down stimuli earlier than originally expected because the economy is growing faster than projected this year. At the moment, however, they were not ready to do so.
Oil prices weak again
Oil prices were under pressure for the third day in a row. The fact that the OPEC + countries were unable to agree on funding quotas was a further burden. The US government, which wants to target high gasoline prices, also provided a downward impetus. The President wanted the Americans to have access to affordable gasoline, the White House said. They are in talks with Opec about a deal that allows additional funding. The dollar gained, the dollar index gained 0.1 percent and climbed to a three-month high. The euro slipped below 1.18. Traders cited new data from the US Department of Labor to justify the appreciating dollar, according to which the number of vacancies rose to 9.21 million in May, from 9.19 million in April. The number of vacancies has thus reached a record for three months in a row.
Bond yields came under renewed pressure after hitting their lowest level since February the previous day. Participants spoke of concerns about the economic outlook and the rapidly spreading delta variant of the Covid virus. The gold price continued its upward trend, trading above $ 1,800 an ounce. Here the hope was based on increased demand. One in five central banks intends to increase their gold reserves next year, according to a report by the World Gold Council. The interest-free precious metal was also supported by the further falling yields on the bond market.
The titles of the Chinese transport service provider Didi Global remained under pressure and fell by a further 4.6 percent. It had already gone down by around 25 percent on the past two trading days. At the weekend, the Chinese Internet regulator issued an order to delete the Didi app from Chinese app stores.
Immersion titles gained 0.1 percent. The specialist in touch-sensitive technology has for its second quarter an almost doubling of the sales compared to the previous year and a profit of 5.1 to 5.5 million dollars.
Apple (+ 1.8%) hit a new all-time high on a closing price basis. Analysts pointed out that Apple stock usually outperforms in the summer quarter due to the usual launch of new iPhones in September. They also referred to an increase in Apple’s production orders for new smartphones.
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