(CercleFinance.com) – The New York Stock Exchange is lining up a third consecutive session of decline this Thursday, affected by the statements of a senior Fed official who shower the scenario of an imminent ‘pivot’ in the policy of the institution.
At the end of the morning, the Dow Jones fell 0.8% to 33,284.2 points, while the Nasdaq Composite lost just over 1% to 11,065.7 points.
St. Louis Fed Chairman Jim Bullard cast a chill this morning by saying that Fed policy had not yet entered a zone tight enough to put significant pressure on inflation.
The head of the Federal Reserve of Saint-Louis explained at a conference organized in Louisville (Kentucky) that the significant rise in rates operated this year by the Fed had not made it possible to approach the objective inflation of around 2%.
‘To reach a sufficiently restrictive level, key rates will have to be increased further,’ he warned.
Investors concluded from his remarks that there would be no immediate pause in the Federal Reserve’s monetary tightening measures.
As a result, the scenario of a new rate hike of 75 basis points is now considered likely by 19.4% of traders according to the CME’s FedWatch barometer, against 14.6% yesterday.
The assumption of a more limited rate increase of 50 points is evaluated at 80.6%, against 85.4% yesterday.
The publication of mixed figures concerning the labor market and the real estate sector has not made it possible to find the way back to the rebound started at the beginning of the autumn.
The Commerce Department reported a 4.2% contraction in housing starts last month, where building permits – supposed to foreshadow future housing starts – fell 2.4%.
The so-called ‘Philly Fed’ index sank to -19.4 in November against -8.7 last month, while economists saw it go back up to around -5.
Finally, registrations for unemployment benefits in the United States fell by 4,000 during the week of November 12 to settle at 222,000 against 226,000 the previous week.
The gloom of investors did not prevent certain companies, whose quarterly results were attractive, from taking the path of the rise.
In distribution, the department store chain Macy’s climbed 11% after having exceeded analysts’ expectations in its past quarter.
Cisco is up 3% after disclosing non-GAAP EPS last night up 5% year-on-year to 86 cents for the first three months of its 2022-23 fiscal year on growing revenue 6% to $13.6 billion.
Nvidia grabs 0.5% after publishing adjusted net profit (non-GAAP) halved to $1.46 billion for its third accounting quarter, or 58 cents per share, and adjusted operating profit down 55 % to 1.54 billion.
James Bullard’s statements support the dollar and weigh on values linked to raw materials, with a sector index which has dropped nearly 2%.
Treasury bonds, on the other hand, gained ground, with the yield on 10-year paper rising towards 3.79% in a climate of heightened uncertainty regarding the evolution of US monetary policy.
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