Thursday, May 20, 2021
Wall Street closes in plus
Bargain hunters also access Bitcoin
US investors are taking courage again. The cyclically sensitive technology stocks in particular are posting significant gains, but investors are still very nervous about the development of inflation and interest rates. Bargain hunters also use Bitcoin.
After the downward slide of the past few days, investors are back to US stocks. The technology-heavy Nasdaq went up significantly. With ongoing concerns about a more rapid rise in inflation and a subsequent tightening of US monetary policy earlier than expected, volatility on the markets is likely to remain high. The Federal Reserve’s minutes showed that at their April meeting, Fed members signaled a desire to discuss a plan to reduce the massive bond-buying program at an upcoming meeting.
The Dow Jones Index closed 0.6 percent higher at 34,084 points, the S&P 500 increased by 1.1 percent. For the Nasdaq Composite it went up 1.8 percent.
The US Federal Reserve opened the door on Wednesday to curb its asset purchases. Commerzbank analyst Ulrich Leuchtmann pointed out that this is by no means a departure from the ultra-loose monetary policy. “It’s not even the beginning of the end. But it’s the beginning of the discussion about the beginning of the end.”
This eased the situation for US bonds, where speculation about interest rate hikes had repeatedly triggered off waves in the past few weeks. On Thursday, the yield on trend-setting ten-year bonds fell to 1.634 percent. The US currency also came under selling pressure. The dollar index, which reflects the exchange rate against major currencies, lost 0.4 percent.
Bargain hunters on the prowl
Investors also picked up on cryptocurrencies again. However, the US government’s plans that all cyber currency transactions with a volume of $ 10,000 or more should be reported to the tax office unsettled them. Therefore could Bitcoin and Ethereum their initial double-digit price gains did not hold and were in the evening (CEST) only a good three percent plus at 39,406 and 2688 dollars. On Wednesday, their courses had slumped at times by 30 and almost 50 percent.
At the same time, stocks from the cryptocurrency sector and companies dealing with the underlying blockchain technology also ended their recovery. The shares of Coinbase, Riot, Marathon, Overstock and Silvergate largely lost their price gains or even turned into the red.
Oatly makes a successful debut on the stock market
The Cisco-Share rose 0.7 percent after a weak start. Although the network specialist beat market expectations in terms of sales and adjusted profit in its third fiscal quarter of 2020/21, it missed the profit outlook. The background to this is the global shortage of chips, which is leading to higher prices.
The retail group Kohl’s earned more than expected in the first quarter and raised its outlook. However, the company is struggling with supply chain problems due to the pandemic, which is causing additional costs. The share fell by 10.2 percent, but had gained almost 50 percent since the beginning of the year. Investors are therefore likely to have used the news to take profits.
ford advanced 3.2 percent. The car manufacturer will set up a joint venture with the South Korean battery manufacturer SK Innovation in the USA. According to the announcement, the two companies have signed a letter of intent for the joint production of battery cells.
Another IPO was also on the agenda. The American Depositary Shares (ADS) of the Oatly Group AB, the world’s largest producer of oat milk products, were listed on the Nasdaq at an issue price of $ 17. The first rate was $ 22.12. At the close of trading, the share was quoted at $ 20.20, an increase of 18.8 percent over the issue price.
Dollar gives up the previous day’s profits
The discussion about a cutback in securities purchases by the US Federal Reserve remained the dominant topic on the foreign exchange market: the dollar tended to weaken again after its recovery rally the previous day. The DXY dollar index lost 0.5 percent, the euro made the jump above the $ 1.22 mark, which it had lost the previous day.
After the previous day’s losses, oil prices fell significantly again. Market participants cited a Bloomberg report as justification, according to which, according to the Iranian President, a broad draft had been found in the negotiations to revive the 2015 nuclear agreement, which provides for an end to the oil sanctions against Iran. This could lead to Iran again appearing more strongly as an oil supplier on the international market.
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