(AFP/Angela Weiss)
The New York Stock Exchange ended at half mast on Wednesday for the first time in three days, again fearing inflation whose May figure promises to be “high”, warned the White House.
According to final results at the close, the Dow Jones index fell 0.81% to 32,910.90 points.
The Nasdaq, with strong technological coloring, lost 0.73% to 12,086.27 points while the S&P 500, the most representative index of the American market, dropped 1.08% to 4,115.77 points.
“The combination of rising crude prices and rising bond yields is worrying,” National Securities’ Art Hogan summed up, pointing out that investors had extrapolated profit warnings from department store chain Target as “a sign of the weakening demand”.
The markets were also awaiting the publication of the US consumer price index (CPI) on Friday.
The indices, which sailed in dispersed order in the first part of the session, faltered after statements from the White House.
“We are expecting a high inflation figure,” White House spokeswoman Karine Jean-Pierre told reporters during a flight aboard the Air Force One presidential plane to Los Angeles, California. where Joe Biden will participate Thursday in the Summit of the Americas supposed to relaunch the relationship with Latin America.
The CPI index may have jumped 0.7% last month, according to analysts’ projections, from 0.3% in April. Over twelve months, inflation was 8.3% in April.
Yields on 10-year Treasuries, which react to the prospect of rate hikes, were again hovering above 3%.
As for crude prices, which are at the heart of the rise in prices, they approached their highest closing level in 13 years for the American variety WTI while Brent was again approaching its March peak.
These inflationary jolts added to the gloomy picture of global growth.
After the downward revision of this by the World Bank on Tuesday, it was the turn of the OECD to slash its projections, predicting only 3% growth in the planet’s economic activity this year against 4.5% for its previous assessment.
As for the US GDP in the 2nd quarter, according to the highly listened projection of the Atlanta Fed (GDPNow), it could grow by only 0.9% against an earlier forecast of 1.3%.
The Fed’s Monetary Committee is meeting next Wednesday and we are expecting a further tightening of half a percentage point for key rates.
Finally, to add to the sad mood of the market, the head of the SEC, the American stock market authority, Gary Gensler unveiled a reform project that will affect the powerful intermediaries dealing with massive order flows, which lack transparency, according to him.
All sectors of the S&P ended down for the session, except energy (+0.15%). Real estate (-2.43%) and materials (-2.10%) led the decline.
The titles of several distribution chains lost momentum such as Lowe’s (-1.64%), Best Buy (-1.57%) or Bed Bath and Beyond (-3.21%).
The suspense continued in the fight between Frontier Airlines and JetBlue for the acquisition of low-cost airline Spirit.
Spirit (-2.25% to 22.16 dollars) postponed, from Friday to June 30, its general meeting during which the company intends to seek the approval of its investors for a merger with Frontier (-3.55% ) which values the carrier at about $2.9 billion, or about $25 per share.
The delay comes days after JetBlue (-4.21%) raised its hostile takeover bid to $31.50 per share.
The streaming access company Roku soared more than 9% to 101.88 dollars while press reports mentioned an interest from Netflix (+ 2.21%) for its takeover.
The title of Novavax laboratories, whose American health authorities recommended the day before, the authorization of the vaccine against the coronavirus, climbed 5.41% to 50.11 dollars.
© 2022 AFP
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