Retail on the rise
Wall Street’s impasse in debt dispute weighs on Wall Street
05/25/2023, 00:21
It is still unclear whether the debt ceiling will be raised in time to avert a US default. This puts another damper on the US stock exchanges. The view from the fashion retailer Abercrombie & Fitch is a source of enthusiasm.
The ongoing debt dispute in the US is getting on the nerves of Wall Street investors more and more. The Dow Jones Index the standard values closed 0.8 percent lower on Wednesday at 32,799 points. The tech-heavy one Nasdaq fell 0.6 percent to 12,484 points. The broad one S&P 500 lost 0.7 percent to 4115 points.
Investors are losing patience after another round of talks between the President’s Office and Republican officials on raising the debt ceiling failed to materialize. “As we get closer to the perceived deadline for the US to run out of money, the markets are getting more nervous if the standoff continues,” said Jamie Cox of financial services firm Harris Financial Group. US Treasury Secretary Janet Yellen has warned that without raising the debt ceiling, the US has only until June 1 to pay federal bills.
Investors were hardly impressed by the publication of the minutes of the most recent monetary policy meeting in early May. US monetary authorities are eyeing a pause after a series of rate hikes. According to this, the senior members of the central bank were generally agreed that after the series of interest rate hikes, further steps upwards were no longer so necessary. Some participants even stated that they believe the hike agreed at the meeting could be the last. The Fed hiked interest rates by 25 basis points at its May meeting.
Analog devices under pressure
The individual values broke Agilent Technologies by almost six percent after the medical technology company lowered its annual sales and profit forecasts. Also the chip manufacturer analog devices alienated investors with his outlook. The papers lost almost eight percent. In the third quarter, adjusted earnings per share are expected to be $2.52 – plus or minus ten cents a share. Analysts had forecast $2.65. Citigroup fell more than 3 percent. The bank has given up plans to sell its Mexican subsidiary Banamex and instead wants to list it on the stock exchange.
Palo Alto Networks on the other hand, climbed 7.7 percent after a more optimistic outlook. The cybersecurity company expects full-year adjusted earnings to be between $4.25 and $4.29 per share. Previously, the range was $3.97 to $4.03.
Encouraging numbers and a price jump of 31 percent at Abercrombie & Fitch boosted the retail sector. After a good start to the year, the fashion chain is now expecting a stronger increase in its net sales. Also Urban Outfitters convinced with their growth, the shares gained more than 17 percent. Department store chain shares Macy’s and north current rose by up to six percent, but then crumbled to a price increase of around two percent each. The department store chain Kohl’s reported a surprise profit and stood by its guidance for the fiscal year. The papers gained around seven percent.