Inflation data on Good Friday
Wall Street is treading water
March 28, 2024, 10:25 p.m
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The Fed is likely to take its time with the next interest rate hikes. Despite this trend, the US indices are entering the Easter break without any injuries. New evidence on US inflation will not come until Good Friday, when investors cannot react to it.
After the positive trend of the previous day, the US stock markets moved more or less sideways on the last trading day before the long weekend, although the overall positive mood continued. The wait for important price data is causing investors to act cautiously, market participants reported. The Dow closed at 39,807 points, 0.1 percent higher than the previous day. The S&P 500 also rose by 0.1 percent and marked a new record high, during the Nasdaq Composite 0.1 percent. On the Nyse, 1,848 (Wednesday: 2,335) shares recorded price gains. They faced 999 (499) price losers. 66 (76) titles closed unchanged.
The problem for the actors was that… PCE deflator of US consumer spending will be published on Good Friday, when business on the financial markets is at a standstill and no immediate reaction can be made. Trading on the bond market even ended early on Thursday. On Easter Monday work will begin again on the stock and bond markets. The tendency is therefore likely to be to play it safe and not risk any new commitments.
The PCE deflator is one of the inflation indicators that the US Federal Reserve pays close attention to in its interest rate policy. US Federal Reserve Governor Christopher Waller just said on Wednesday that the latest inflation data had been disappointing and that there was therefore no hurry to cut interest rates and that they should perhaps cut them less frequently this year than previously announced. Most recently, the signals for 2024 were a total of three interest rate cuts. The dollar reacted to Waller’s statements with a small increase. Yields on the bond market appeared to be well maintained, also supported somewhat by the Fed Governor’s statements, which were interpreted as hawkish.
Before the PCE deflator and Powell’s appearance, there were a few more on the reporting day Economic data published, but they did not provide any stimulus to the market. In some cases the data was announced in second or third readings. But even the surprisingly weak one Purchasing Managers Index the Chicago region did not move the market. It fell to 41.4 in March from 44.0 in February. Economists had seen the index at 45.7 points. The reason for the market’s calm reaction could be that the problems at Boeing were mainly responsible for the drop in the index, and not a general slowdown in the US economy, suggested Oliver Allen from Pantheon Macroeconomics.
Walgreens adjusts with strong numbers
The individual values went for Walgreens Boots Alliance up 3.1 percent. The drugstore chain had to take a high write-off on its medical practice subsidiary VillageMD but performed better than expected in terms of earnings and sales in the quarter under review on an adjusted basis. Walgreens narrowed its profit outlook for the full year slightly.
Disney gained 1.1 percent. The company has settled the dispute with Florida Governor Ron DeSantis over the special status of the area in Orlando on which the main theme park is located. Disney now recognizes the invalidity of a 30-year development plan. An earlier plan now applies, but still allows for expansion. Home Depot acquires SRS Distribution, a specialist distributor for professional building contractors, for $18.25 billion. Home Depot shares closed 0.6 percent in the red.
For Chemours it fell by 9.1 percent. The fact that an internal investigation at the chemical company revealed that executives had shifted cash flows in order to increase bonuses was a heavy burden here. The business figures presented by Chemours the evening before after the stock market closed were lost.
The Furniture manufacturer RH has given an optimistic outlook by presenting quarterly figures and expects demand to increase. The price rose by 17.3 percent. The competitor’s stock Millerknoll However, it fell by 18.8 percent after an outlook that was below expectations. In the software sector Braze by 12.3 percent. In terms of earnings, the company performed better than expected in its fourth quarter, but was still in the red.