Operators of the New York Stock Exchange (GETTY IMAGES NORTH AMERICA/AFP/SPENCER PLATT)
The New York Stock Exchange ended sharply higher on Friday, posting multi-month highs to close for the Nasdaq and S&P 500, buoyed by strong jobs numbers that fuel hopes for a soft landing in the American economy.
The Dow Jones gained 2.12%, the Nasdaq index rose 1.07% and the broader S&P 500 index gained 1.45%.
The Nasdaq ended at its highest closing level in 13 months, while the S&P 500 had not experienced these heights at the end of the session for 9 months.
In a sign of a turning point for Wall Street, the VIX index, which measures investor nervousness and market volatility, fell to its lowest level in nearly two years.
“It was clearly a risk-taking day,” commented Angelo Kourkafas of Edward Jones.
“The two good news were the extinction of the risk linked to the debt”, with the vote, the day before, of a text in the Senate, “and the almost ideal report on employment”, continued the analyst.
The US economy added 339,000 jobs in May, nearly double the figure projected by economists (190,000).
The figure was so high that it could have worried traders about a possible continuation of monetary tightening by the US central bank (Fed) to curb inflation.
But the observation was nuanced by the greater than expected rise in the unemployment rate, to 3.7% against 3.4% in April, as well as by the deceleration in the pace of increase in the average wage, to 0.3% on one month against 0.4% previously.
Overall, “we believe in a soft landing” for the US economy, according to Angelo Kourkafas.
“These contrasting data will give the Fed arguments to leave its rates unchanged at its next meeting” on June 13 and 14, argued Nancy Vanden Houten of Oxford Economics.
Traders expect a further hike in July, which would be the last in this cycle.
The surge in equities came at the expense of bonds, which tumbled.
In addition to risk appetite, the movement is due to the prospect of massive bond issues by the US Treasury, which will have to rebuild its reserves after being prevented for weeks by the debt crisis.
The yield on 2-year US government bonds stood at 4.49%, against 4.34% the day before closing.
On the stock market, for once, the Dow Jones and traditional stocks have done better than the Nasdaq, which had driven the entire market in recent months thanks to the tech giants.
“There is a semblance of rotation going on”, observed Angelo Kourkafas, stimulated, in part, by the macroeconomic data of the day, which suggests that “consumers still have ammunition” thanks to the good performance of the oil market. ‘job.
At the Dow Jones, Caterpillar (+8.40%) and Boeing (+2.58%) particularly shone.
Elsewhere, Amazon (+1.21%) took advantage of information from the Bloomberg agency according to which the group plans to launch a mobile phone offer for its Prime subscribers, at low cost, or even free of charge. Asked by AFP, Amazon denied.
Telephone operators suffered from this development, whether AT&T (-3.80%), T-Mobile (-5.56%) or Verizon (-3.19%).
The Canadian sports equipment manufacturer Lululemon Athletica (+11.30%), known for its high-end yoga pants, sprinted after publishing, Thursday after the stock market, results that exceeded expectations and raised its annual forecasts.
the 3M conglomerate soared (+8.75%) after Bloomberg reported an amicable agreement to avoid a lawsuit brought by hundreds of local authorities who are claiming damages from it for the contamination of their water to perfluoroalkylated and polyfluoroalkylated, also called PFAS, nicknamed “eternal” pollutants.
Before the stock market, the petrochemical groups DuPont de Nemours (+7.31%) and Chemours (+24.09%) had announced an agreement in the same file.
© 2023 AFP
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