Hope for a break in interest rates
Wall Street starts the week confidently
September 11, 2023, 10:34 p.m
Listen to article
This audio version was artificially generated. More info | Send feedback
The US stock markets are recovering – at different speeds. While the Dow Jones Industrial index rose moderately, the market-wide S&P 500 and the technology-heavy Nasdaq indices rose significantly.
Wall Street started the new week with a recovery movement. The Dow Jones Index At the closing bell it was up 0.3 percent at 34,664 points. The S&P 500 rose by 0.7 percent and the Nasdaq Composite by 1.1 percent. 1,606 (Friday: 1,526) titles recorded price gains, while 1,311 (1,380) losers were counted and 81 (109) titles closed unchanged.
However, it is questionable whether the recovery will continue in the coming days. Important economic data will be on the agenda over the course of the week. The US CPI for August is due on Wednesday and the August Retail Sales report is due on Thursday. Both dates have the potential to influence whether the Federal Reserve will change interest rates at its meeting next week. However, the market is currently pretty sure that the Fed will leave the key interest rate unchanged. This confidence supported prices.
Last week the S&P 500 lost 1.3 percent. “A key catalyst for the recent volatility has been the relentless rise in oil prices, which has exacerbated inflation concerns,” says Stephen Innes of SPI Asset Management. This came at a time when many major central banks were considering whether they might be able to complete their interest rate hikes or at least are in the final stages. Bond yields, which briefly fell at the end of August, continued their upward trend again.
Oil prices are falling
On Monday, oil prices fell slightly, while the ten-year yield rose slightly to 4.28 percent. Bond yields had benefited from expectations of stubbornly high inflation, it said. Investors were betting that interest rates would stay high for a long time.
The dollar fell slightly, the dollar index lost 0.5 percent. Verbal interventions, both in favor of the yen and in favor of the yuan, by the respective central banks in Japan and China caused some movement. The yen traded significantly higher than on Friday, as did the yuan.
RTX weaker – Tesla in demand
RTX lost 7.9 percent. RTX, formerly Raytheon, has lowered its forecast due to the costs of recalling aircraft engines. RTX has to recall hundreds of Pratt & Whitney engines because of a metal powder used in the production process.
Tesla rose by a good 10 percent after Morgan Stanley upgraded it to overweight. Goodyear trended 2.8 percent weaker. As part of a restructuring, the tire company wants to reduce its workforce in Europe, the Middle East and Africa by around 1,200 jobs. The job cuts are expected to result in pre-tax costs of approximately $210 million to $230 million. The measures are expected to bring savings starting next year.