Salesforce crashes
Euphoria on Wall Street has evaporated
12/01/2022, 11:14 p.m
After the previous day’s rally due to statements by the Fed chief about the interest rate of the US Federal Reserve, realism returned to Wall Street on Thursday. Investors tend to take profits and are once again playing the fear of recession card. The software provider Salesforce is punished after a gloomy forecast.
After indications of smaller interest rate hikes by the Fed, the euphoria of US investors has subsided. Of the Dow Jones Index the standard values closed 0.6 percent lower on Thursday at 34,395 points. The tech-heavy one Nasdaq advanced 0.1 percent to 11,482 points. The broad one S&P 500 lost 0.1 percent to 4076 points. “Yesterday’s move was so crazy big that it’s probably just natural profit-taking,” said Rusty Vanneman, chief investment strategist at investment adviser Orion.
At the same time, traders are advised to be cautious ahead of the US jobs data at the end of the week. After the economic data published on Thursday, analysts spoke of a mixed picture. “The manufacturing sector is obviously in a recession,” said Peter Cardillo, chief economist at investment firm Spartan. At the same time, the price index for consumer spending rose by 0.3 percentage points less than in the previous month, which may indicate slowing inflation. The initial jobless claims, on the other hand, were slightly lower than expected.
According to Konstantin Oldenburger, market analyst at online broker CMC Markets, the continued strength of the labor market could prevent the US Federal Reserve from making smaller interest rate hikes. “This needs to cool further for the Fed to be confident that inflation will fall towards its 2% target.”
Nevertheless, Fed Chair Jerome Powell’s speech and the prospect of an easing of strict corona restrictions in China put the anti-crisis currency on course dollar to. The index, which measures US foreign exchange against other major currencies, fell another 1.2 percent to 104.72 points on Wednesday after a one percent price slide.
The market’s indecisiveness was reflected primarily in growth stocks, with fluctuating losses and gains at corporations such as Tesla, Microsoft, Amazon and Apple. The titles of the software house Salesforce fell by more than eight percent after the announcement of a change in the board of directors. Also the stock of the wholesaler Costco fell more than 6 percent after disappointing sales figures for November.