Monday, May 24, 2021
Virgin Galactic takes off
Wall Street suppresses inflation concerns
While there was no trading on the Frankfurt Stock Exchange at the end of the Whitsun weekend, things are going on again on Wall Street. There is a noticeable plus in technology stocks. For a company, things are skyrocketing.
The US stock exchanges posted significant price gains. Technology stocks, which had recently been under pressure with increased inflation worries, gained somewhat more and thus recovered. “Inflation concerns have eased somewhat. There is a broader perception that inflation will be temporary,” said Kleinwort Hambros’ market strategist Fahad Kamal. The official view of the US Federal Reserve, which also speaks of only a temporary rise in inflation, thus prevailed. This point of view is used to argue that we can continue to do without monetary policy tightening. Because that’s what the stock market fears.
The Dow Jones Index rose by 0.5 percent to 34,394 points. The S&P 500 and the tech-heavy one Nasdaq Composite rose by 1.0 and 1.4 percent, respectively.
The Chicago Fed National Activity Index was published as the only economic date. However, the month-on-month decline reported for April did not affect the stock markets. The bond market did not provide any new insights into the inflation debate because little happened here. The yield on ten-year US Treasuries fell slightly to 1.60 percent. The gold price, which had recently reacted sensitively to concerns about inflation, hardly moved either.
After its recovery at the end of the week, the weakened U.S. dollar yet again. The euro rose to around 1.2220 dollars after exchange rates well below the 1.22 mark on Friday. The DXY dollar index lost 0.2 percent. ING’s foreign exchange analysts believe the greenback will continue to weaken over the course of the week. The declining volatility in the foreign exchange market is encouraging investors to take greater risks. This put a strain on the supposedly safe dollar haven. The analysts expect a rotation from US assets to more promising investments outside the dollar area. In the short term, the dollar index could slide back to its most recent lows – unless the US Federal Reserve signals that it is scaling back monetary policy easing.
Oil price could rise to $ 80
After falling to the lowest levels in months on Sunday, Bitcoin recovered somewhat. The price rose by around 16 percent, but the cryptocurrency has lost over 40 percent of its value since its recent highs in April. The crackdown on the part of the Chinese authorities has recently hit the market for digital currencies badly. Nevertheless, analysts said that the bubble had not yet completely dissolved.
The Oil prices however, picked up strongly. Goldman Sachs analysts believe that crude oil prices will reach $ 80 per barrel as early as the summer. In the trade there is talk of a possible “super cycle” for crude oil. Observers also pointed to doubts about an early agreement in the nuclear dispute with Iran.
Improved among individual stocks Moderna by 1.7 percent. The pharmaceutical company has reached an agreement with Samsung Biologics. The South Koreans will in future produce the corona vaccine from Moderna. Apple gained 1.3 percent. CEO Tim Cook has defended the rules of the technology company’s app store in the process launched by video game developer Epic Games.
Virgin Galactic shot up nearly 28 percent. The space company successfully completed its first manned space flight over the weekend. Splunk increased by 1.4 percent. The UBS analysts had recently made positive comments about the cloud software provider and raised the rating.
AMC Entertainment climbed 13.2 percent. The largest shareholder of the cinema chain operator, the Chinese group Dalian Wanda, has sold most of its shares, according to a press release.
Nvidia gained 4.1 percent, the semiconductor company had announced a share split at a ratio of 1 to 4 last Friday in order to make the titles more tradable. On a split-adjusted basis, Nvidia shares will start trading on June 20th.
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