(CercleFinance.com) – Wall Street ended the session on a very heavy note with the Dow Jones dropping -1.5%, the S&P500 at -1.6% and the Nasdaq at -2%.
The monthly balance sheet thus comes out negative by -3.5% for the ‘S&P’ and -3.9% for the Nasdaq which falls significantly below 16,000 Points, penalized by Sirius -7.3%, Tesla -5.6% , Microsoft -3.2%, Intel -2.8%, Alphabet -2%, Apple -1.8%… and Amazon, which fell by -3.3%, recovered +3.5% after publication of its results , higher than consensus with $0.98 per share versus $0.85 expected and AWS revenue up +17%.
AMD for its part published results perfectly in line with the consensus (but investors hoped for better and the stock lost -3.5%) and it was Pinterest which stood out with +24% with a turnover 10% higher than expectations and a number of users passing the 500 million mark worldwide.
The S&P500 fell in the wake of the casino/entertainment sector (-5% on average) and oil groups with Marathon -9.8%, Valero -4.1%, Halliburton and Devon -3.6%, Occidental -3 .3%, Chevron -3%.
On the figures side, the Conference Board’s consumer confidence index deteriorated significantly (-6.1 points) for the third consecutive month in April, to 97 this month compared to a revised figure of 103.1 in March: it this is its lowest level since July 2022.
The subindex measuring consumer expectations fell to 66.4 from 74 last month, a figure below the 80-point threshold often a harbinger of a coming recession.
Wall Street suffers a halt at 5 months of increase, but does not validate a major shift, especially since the tension in rates could have caused much more damage on the ‘technos’ (the most vulnerable to the deterioration of credit conditions).
T-Bonds rose by +7Pts to 4.685%, the ‘2-year’ by +5Pts to 5.023%.
The markets are poorly handling the uncertainties surrounding the tone of the Fed press release which will be published tomorrow evening.
No rate change is expected on occasion, but the speakers will dissect the language relating to inflation: it was almost unthinkable 3 months ago, but the hypothesis of zero rate cuts in 2024 and an increase in January 2025 (in 9 months) now garners 33% of the votes, while a first rate cut in September has a marginal majority.
The last few weeks have been clearly marked by a spectacular downward revision of expectations for rate cuts in the United States for 2024, from seven to potentially zero.
This session also demonstrated the vulnerability of cryptos to the tension in US rates: Ethereum fell by -6.5%, Solana by -7%, Bitcoin by -5%, below the major support of $60,500/$60,000 (BTC is at its lowest this evening at 59,850, around 10:15 p.m.).
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