Nasdaq on the up
US investors grab tech stocks
01/23/2023, 11:15 p.m
Wall Street traders are optimistic about the upcoming earnings season. Above all, the recently spurned technology stocks are in demand. Bitcoin is also on the up again.
The abated fear of interest rates and recession is driving prices on Wall Street further up. The closed before a flood of company balance sheets Dow Jones Index the standard values on Monday 0.8 percent higher to 33,629 points. The broad one S&P 500 increased 1.2 percent to 4019 points. The tech-heavy one Nasdaq advanced 2.0 percent to 11,364 points, building on Friday’s gains, the best trading day since late November.
Technology stocks were in particularly high demand on both sides of the Atlantic. “The ongoing wave of layoffs remains an ongoing issue in the technology sector,” said Konstantin Oldenburger, market analyst at brokerage house CMC Markets. After Microsoft, Amazon and the Google parent Alphabet, the music streaming service Spotify followed with the announcement of wanting to lay off around six percent of its workforce. The news was well received by the stock market: Spotify-Shares climbed about two percent. “The stock market is reacting positively to this news because companies are paying more attention to their costs than before,” emphasized Oldenburger.
The German share index, on the other hand, has only continued its rally since the turn of the year with the handbrake on. the dax rose 0.5 percent to 15,103 points on Monday. Good quarterly figures from companies such as Microsoft, Tesla and Boeing could be a possible ray of hope in economically tense times in the coming days, said CMC Markets analyst Jochen Stanzl. In addition, investors hoped for information on the economic prospects from the purchasing manager indices for the euro zone and the USA on Tuesday. Market traders expected data to have improved more in Europe than in the United States.
Speculations about further interest rate hikes in Europe set the tone at times dollar under pressure and heaved the Euro down to $1.0927, its highest level since April last year. “So when you weigh the outlook for central bank policy, the dollar is at a disadvantage as the market bets the Fed will move slower than its overseas counterparts,” said Joe Manimbo, market analyst at Convera in Washington. While in Europe there were increasing indications of two further interest rate hikes of 50 basis points each, market participants only expect smaller rate hikes from the US Federal Reserve.
The increasing willingness to take risks also drove investments such as Bitcoin on. The cryptocurrency rose in price by more than three percent to as high as $23,112. “There is a subtle fear among market participants that they may miss the rally,” said Timo Emden from the analysis company Emden Research. The tipping point remains the hope that price pressure in the USA will continue to lose momentum and that the US Federal Reserve will take its foot off the interest rate accelerator in the coming months.
Chip manufacturers asked
The individual values rose rapidly, especially for chip manufacturers. The rivals Qualcomm and Advanced Micro Devices climbed between 6.6 and 9.2 percent after brokerage house Barclays upgraded both groups to “overweight” from previously “equal-weight”. Also the titles of Western Digital rose almost nine percent. The background was a report about a possible merger between the manufacturer of memory chips and the Japanese company Kioxia Holdings.
The renewed entry of an activist investor into a technology group also aroused price fantasies: the shares of the cloud-based software company Salesforce up more than 3 percent after hedge fund Elliott made a multi-billion dollar buyout of SAP rival, an insider said.
Microsoft, meanwhile, announced another multi-billion dollar investment in OpenAI, further pushing into the promising artificial intelligence (AI) market. OpenAI is behind the chatbot Chat GPT, software that responds to questions in natural language and can generate prose or poetry on command. Microsoft has begun incorporating OpenAI technology into its Bing search engine, which is being touted as a potential competitor to industry leader Google for the first time in years. Microsoft-Shares rose about one percent.