(CercleFinance.com) – Wall Street was the victim of a rare intraday reversal of steam (around -2% straight from 7:30 p.m. to 10:00 p.m.) following a statement from Neel Kashkari, president of the Minneapolis FED: he warns that ‘if inflation continued to follow successive sequences of declines then occasional bursts, the question would arise as to whether we should not give up on any rate reduction this year’ (he is leaning towards 2 reductions in 2024, and condition that prices continue to decline).
Kashkari’s statements had the effect of a cold shower and the Dow Jones went from +0.5% to -1.35%, the S&P500 from +0.75% (i.e. 5,257, close to 0.15 % near its peaks) at -1.35% and the Nasdaq from +1.1% to 16,468 to -1.5% around 16,050.
The ‘tech’ index experienced one of the largest intraday amplitudes of the year, and not ‘in a good way’, following strong releases on AMD -8.3%, KLA -3.6%, Nvidia and Broadcom -3.4%, Micron -3.1%, Marvell -2.9%, Alphabet -2.8%, Qualcomm -2.4%…
Reminder: Wall Street had gained +16% in 9 weeks at the end of 2023 on expectations of 7 to 8 easing of the rent of money in 2024.
A sign of the stress that shook Wall Street, the ‘VIX’ which was moving in the morning in the ‘complacency’ zone around 13.75 jumped +15% towards 16.50, the most significant movement since the 13 February and above all the most negative in the end since October 13, 2023 (16.70/19.3).
In addition to doubts about monetary easing in June, the geopolitical climate is becoming anxiety-provoking in the Middle East with actions of completely unprecedented aggressiveness against Iranian diplomatic representations on foreign soil and then ‘accidental’ shootings targeting Western humanitarian workers. .
Investors also took note of a series of statistics this Thursday: the United States trade deficit increased to 68.9 billion dollars in February, compared to that of 67.6 billion the previous month (which was revised from an initial estimate of $67.4 billion), according to the Commerce Department.
This 1.9% increase in the deficit from one month to the next reflects a 2.2% increase in imports of goods and services by the United States, to 331.9 billion dollars, while its exports increased. are increased by 2.3% to 263 billion.
The Department of Labor announces having recorded 221,000 new registrations for unemployment benefits in the United States for the week of March 25, a figure up 9,000 compared to the revised figure for the previous week (212,000 instead of 210,000).
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