(CercleFinance.com) – The New York Stock Exchange should hesitate on Friday at the start of the session, struggling to rebound after the losses suffered the day before against a backdrop of persistent fears around inflation.
Half an hour before the opening, the ‘future’ contracts on the main New York indices show gains of around 0.1%, announcing an opening without much trend.
The S&P 500 fell 1.8% yesterday, while the Nasdaq Composite fell more than 2%, a decline that brought the tech index back into correction territory after falling more than 10% from its latest highs.
The unprecedented level of US inflation in January reinforced expectations of forthcoming rate hikes and raised concerns about the economic situation.
“This release certainly increases the likelihood of the Federal Reserve raising rates by 50 basis points in March, and the market is now pricing it in with a 50% probability,” predicts Tiffany Wilding, chief economist for America. North at Pimco.
Anyway, these figures will not fail to worry the Fed, warns the analyst.
“At a minimum, today’s data reinforces our forecast that the Fed will likely begin raising rates at the rate of one hike per meeting,” Tiffany Wilding said.
The prospect of rate hikes is usually unfavorable to equity markets, but some strategists believe that it does not call into question the underlying trend that drives Wall Street.
“We believe that corporate fundamentals remain strong enough to offset the adverse impact of interest rate hikes and we expect continued stock market gains,” said Mark Haefele, chief investment officer of the asset management arm. wealth of UBS.
“During the 4th quarter earnings season, about 78% of companies did better than expected in terms of profits, the components of the S&P 500 being on track to post a growth of 26% in their profits,” recalls the strategist.
The results season is nevertheless beginning to draw to a close in the United States and quarterly publications are becoming rarer, even if the sports equipment manufacturer Under Armor unveiled its accounts this morning.
The session also promises to be light on the side of indicators, the only economic figure expected today being that of the consumer confidence index of the University of Michigan, which will be released in the morning.
Copyright (c) 2022 CercleFinance.com. All rights reserved.