Tuesday, May 11, 2021
Wall Street continues downhill
Fears of inflation scare US investors off
Fears of inflation and interest rates are driving investors on Wall Street to flight. Rising raw material prices and the upcoming announcement of current price data from the United States are causing increasing nervousness.
Wall Street is burdened by renewed price losses of the US technology companies. The Dow Jones Industrial, which the day before had risen above the 35,000 point mark to another record high for the first time, closed with a minus of 1.36 percent lower at 34,269.16 points. The market breadth S&P 500 lost 0.87 percent 4152.10 counter. The technology-heavy one Nasdaq 100 decreased by 0.06 percent 13,351.27 pointsafter dropping 2.6 percent at the start of the week.
“If you value high-growth technology stocks based on their earnings ten years from now, those surpluses are worth less than they are today when inflation rises,” said Dan Eye, chief analyst at Fort Pitt. With this in mind, the shares of US corporations such as Apple, Microsoft or the Google mother alphabet up to one percent after.
The perfect storm is brewing on the price front, warned Neil Wilson, chief analyst at online broker Markets.com. Currently, rising wages, rising raw material prices and the post-pandemic consumer backlog are fueling inflation. “The price pressure will not be as temporary as the US Federal Reserve thinks.” Against this background, stockbrokers eagerly awaited the US consumer price data on Wednesday. Analysts expect an average inflation rate of 3.6 percent year-on-year for April. In the previous month, the value was 2.6 percent.
Despite a possible rise in inflation, foreign exchange investors did not expect the Fed to tighten the monetary reins in the foreseeable future, said Karl Schamotta, chief investment strategist at the financial services provider Cambridge Global Payments. This depressed the Dollar index, which reflects the exchange rate against major currencies, to a two and a half month low of 89.982 points.
Business optimists shaped the mood in the industrial metals market. You bet on an increasing demand thanks to the expected global upswing with a simultaneously scarce supply, said stockbrokers. Copper rose to $ 10,724 a ton and stayed in touch with the recent record high of $ 10,747.50.
The US stocks stood out Novavax with a Price slide of 14 percent out. The pharmaceutical company does not expect US approval for its coronavirus vaccine until the third quarter instead of May. The delays are a disappointment, commented analyst Kelechi Chikere of the investment bank Jefferies. However, nothing will change in the medium to long-term outlook. Things went downhill for L Brands. The titles of the fashion and cosmetics group lost 1.8 percent. The company wants to spin off its underwear brand “Victoria’s Secret” instead of selling it, as is generally hoped. According to media reports, Victoria’s Secret could be valued at five to seven billion dollars on the stock exchange. The bids for prospective buyers would have been $ 3 billion.
Tesla became cheaper 1.9 percent. The manufacturer of electric cars has put the purchase of a property in Shanghai on hold, as reported by Reuters, citing unnamed sources. Actually, Tesla wanted to expand its production capacities in China, but initially forego because of the tensions between China and the USA. Honeywell showed up meanwhile 1.4 percent lower. The share switches from Nyse to Nasdaq. The Boeing share collapsed 1.7 percent from. The aircraft manufacturer only delivered 17 aircraft in April, while its competitor Airbus had 45 aircraft.
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