(Boursier.com) — Wall Street was in the red on Friday, for the last session of the year 2023, but still not far from its peaks, investors nevertheless showing themselves optimistic with a view to an imminent drop in prices. rates of the major central banks, starting with the Fed.
The Dow Jones index lost -0.05% to 37,689.54 points. The broader S&P500 lost 0.28%, to 4,769.83 points. The Nasdaq Composite fell 0.56% to 15,011.35 points.
The market saw positive momentum in the final months of the year, which saw all three major Wall Street indexes record monthly, quarterly and annual gains.
The year 2023 was marked both by the banking crisis which hit the United States in March, followed by the big jump in technological stocks linked to artificial intelligence led by Nvidia and Microsoft, all against a backdrop of slowing inflation and deflation of supply chain problems, enough to fuel expectations of a reduction in Fed rates by 2024.
It was the easing of long-term rates that helped trigger a rally at the end of the year, which accelerated in December when the Fed clearly opened the door to reductions in its interest rates in H1 2024.
On the bond markets, the yield on the 2-year T-Bond is now at 4.28%, compared to 3.87% on the 10-year bond and 4.01% on the 30-year bond. The dollar index returned to its 5-month lows against a basket of reference currencies, the euro even returning above 1.10/$ while the ECB’s intentions in terms of easing monetary policy are much less clear than those of the Fed for 2024…
On Friday, the Chicago regional PMI manufacturing index for December 2023 fell into contraction zone. It stands at only 46.9 against a consensus of 50. The index stood at 55.8 a month earlier. The reading for the month therefore signals a contraction in manufacturing activity in the region considered in December.
This is a slight disappointment, as operators have been banking for months on the scenario of a relatively soft economic landing and a continued decline in inflation, a scenario which would allow the Fed to relax its policy relatively quickly. monetary policy, after the accelerated tightening of recent months.
According to the CME Group’s FedWatch tool, the probability of a new monetary status quo on January 31, 2024, for the next FOMC meeting, is more than 85%. The first rate cut could occur on March 20 (probability of more than 72% of a range 5-5.25% on the fed funds rate, compared to 5.25-5.5% currently). Rates are expected at the end of next year between 3.75 and 4% (38% probability) or between 3.5 and 3.75% (35% probability).
The Nasdaq 100 achieved its best annual performance (nearly 55% in 2023) since 1999. The Nasdaq Composite as a whole climbed 43.4% this year, its best performance since 2003. The rich index in technology stocks was helped by the rebounds of the ‘Magnificent Seven’ (Apple, Amazon, Alphabet, Meta, Tesla, Nvidia and Microsoft). The S&P 500 has finally increased by 24% since January 1 and the Dow Jones by 13.7%…
Values
Google (Alphabet -0.3%) has settled a $5 billion consumer privacy dispute, Reuters reported. The Californian Internet giant was accused of secretly tracking the use of the Web by millions of people who thought they were browsing privately, the agency adds. U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California, on Thursday suspended a trial scheduled for Feb. 5 in the proposed class action, after attorneys for Google and consumers said they had reached a preliminary settlement . Reuters adds that this lawsuit sought to obtain $5 billion or more. Terms of the settlement were not disclosed. The lawyers said they had agreed to a binding term sheet through mediation and planned to present a formal settlement for court approval by Feb. 24. The plaintiffs alleged that Google’s analytics, cookies and apps tracked their activity even when they set Google’s Chrome browser to ‘Incognito’ mode and other browsers to private mode. The lawsuits filed in 2020 covered millions of Google users since June 1, 2016 and sought at least $5,000 in damages per user for violations of federal wiretapping laws and California privacy laws, Reuters recalls.
Boeing (+0.1%) indicated that all of its 737 MAX aircraft operated by airlines in China were back in service by the end of 2023. At least that is what Liu Qing, the group’s general manager for China, said , according to which operations have fully resumed for the 737 MAX, which would represent nearly a hundred aircraft. This is therefore reassuring news for the American group, which has come a long way after the global immobilization of 2019. The group’s best-selling model was grounded after fatal accidents in Indonesia and Ethiopia.
JD.com (+1.3%), one of China’s e-commerce giants, said it had won a lawsuit against its rival Ali Baba (+0.3%), fined one billion yuan ($141 million) for monopolistic practices. It was thus found that Zhejiang Tmall Network, Zhejiang Tmall Technology and Alibaba Group had abused their dominant position on the market and had engaged in monopolistic practices, according to a court decision by the High People’s Court of Beijing mentioned by JD .com. “This decision is not only a fair decision (…), but it also constitutes a historic moment in respecting market fairness and the order of competition through the rule of law “, indicates JD on his official WeChat account. “This will be an important moment in China’s anti-monopoly legal process,” the group added.
UnitedHealth (+0.3%) has agreed to sell its operations in Brazil to a private investor… The American healthcare and insurance group revealed today that it plans to finalize the sale in the first half of the next year and as a result record a primarily non-cash charge of $7 billion, largely due to the impact of foreign exchange losses. The buyer is the founder and general director of the health insurance firm Qualicorp, José Seripieri Filho. A Reuters source previously valued the deal at $515 million.
Fisker (+15.8%), the small American designer of electric vehicles indicated that its EV deliveries had… more than quadrupled during the last quarter, which would allow it to deliver around 4,700 vehicles across the entire the year. The quarterly performance is mainly due to the success of the Fisker Ocean SUV, priced at around $69,000. The group thus posted growth in deliveries of more than 300% between the third and fourth quarters. “After approval delays in Europe and the United States, and while we resolved supplier issues, Fisker ultimately produced 10,142 units in 2023. Deliveries to customers began in June, with significant deliveries beginning in September and October. The company increased its deliveries by more than 300% between the third and fourth quarters, and total deliveries are approximately 4,700, the majority being Fisker Ocean One launch vehicles priced at $68,999 (comparable price in other markets)”, specifies the group.
Nvidia (stable) remains the big star of Wall Street this year. With a performance of nearly 240% since January 1, the file now capitalizes more than 1,200 billion dollars. It must be said that Jensen Huang’s group has been literally boosted for several quarters by the incredible demand for its artificial intelligence products. It remains to be seen whether the graphics processor and AI giant will be able to maintain its dominance and circumvent the bans on the export of its most advanced products to China. Regardless, the level of global demand for AI products should largely offset this possible Chinese weakness. Note that the group has just launched a new gaming chip for China in order to comply with export restrictions.