(CercleFinance.com) – Wall Street should outline a timid rebound on Tuesday morning, driven by a few buybacks after six sessions of decline, even if the market could be irregular in the absence of driving forces.
Half an hour before the opening, the ‘future’ contract on the S&P 500 index progresses by more than 0.1%, while that on the Nasdaq 100 takes not far from 0.4%, suggesting a small recovery at the opening.
The Dow Jones has just lined up six consecutive sessions in the red, a bearish sequence that has led it to drop more than 2% since Thursday, June 15.
It is true that the recent indicators seriously signal the possibility of an imminent recession, even if it remains difficult to estimate the timing, and above all the intensity.
At the same time, investors continue to wonder about the prospect of further rate hikes from the Fed, which raises fears of a possible excess of zeal in its fight against inflation.
“The markets are beginning to estimate that interest rates will remain high for longer and the yield curves appear more and more inverted, which creates a delicate environment for equities,” says one at Pictet Wealth Management.
In terms of indicators, the Commerce Department reported this morning a 1.7% increase in durable goods orders in the United States last month, after an increase of 1.2% in April.
Still, excluding transportation equipment, orders for which climbed 3.9% month-on-month, US durable goods orders rose just 0.6% in May.
In short, this news does not seem encouraging enough to really boost investors’ appetite for risk.
Today’s session should therefore remain flat and the trend will probably remain hesitant until the publication on Friday of the price index linked to personal consumption expenditure (PCE), which remains the measure of Fed’s favorite inflation.
Otherwise, the day will be marked by the publication, later in the morning, of the Conference Board’s consumer confidence index and new home sales.
Along with the small rebound looming in equities, US government bond yields rose on Tuesday as the dollar weakened, which seems to signal less risk aversion.
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