Operators of the New York Stock Exchange (GETTY IMAGES NORTH AMERICA/AFP/SPENCER PLATT)
The New York Stock Exchange opened higher on Monday, driven by technical momentum that began last week and the hope of confirmation on Tuesday of a deceleration in inflation in the United States.
Around 2:15 p.m. GMT, the Dow Jones gained 0.85%, the Nasdaq index took 1.09%, and the broader S&P 500 index, 1.05%.
After dropping a week ago to its lowest level in almost two months, the S&P 500 remains on three consecutive bull sessions and closed Friday above an important technical threshold, the average on the last 50 trading days.
“There is technical momentum in the market,” commented Briefing.com’s Patrick O’Hare in a note, “and hopefully there will be some element of fundamental support soon after the release of the report. ‘CPI index for August’, due Tuesday.
In July, this index was unchanged compared to the previous month, after having climbed by 1.0% and 1.3% respectively in May and June, and up by 8.5% over one year against 9.1% in June.
“Some indicators suggest that the CPI slowed further in August,” said Jack Ablin of Cresset Capital, citing lower gasoline prices, stabilizing wages and a lull in the food sector. “So investors are confident that inflation peaked in June and the rate will continue to slow.”
Economists expect a slight decline of 0.1% compared to July and an increase of 8.0% over one year.
This widely shared impression, however, did not change investors’ forecasts for the next meeting of the US central bank (Fed), with an 88% probability attributed to a 0.75 percentage point hike in the key interest rate. Federal Reserve, the third in a row.
By contrast, Wall Street now expects the rate to fall in the second half of 2023, although several Fed officials have warned they see rates remaining high over the medium term.
The wind of optimism about the trajectory of inflation and interest rates with, in sight, a possible soft landing for the US economy, was also blowing on the bond market.
The yield on 10-year US government bonds eased to 3.28%, from 3.30% on Friday. The three-month rate, for its part, registered a new high of 14 years, at 3.03%, a sign of the anticipation of continued monetary tightening in the short term.
The week got off to a flying start for the Bristol Myers Squibb laboratory (+5.66% to 74.13 dollars) after the authorization by the drug regulatory agency, the Food and Drug Administration (FDA), to market for its psoriasis drug Sotyktu.
Twitter fell (1.68% to 41.48 dollars) at the start of an important week that will see the company’s former chief information security officer appear before the US Senate Judiciary Committee on Tuesday.
The same day, an extraordinary general meeting will be held to validate the takeover of the platform by Elon Musk, an operation which the entrepreneur has officially renounced and which will be the subject of a trial in October.
Disney advanced (+ 1.31% to 116.69 dollars) while the founder of the investment company Third Point, Daniel Loeb, explained on Sunday that he was renouncing to claim from the group the split with its subsidiary of information and dedicated sports TV station ESPN. The investor had indicated, in mid-August, to have bought for a billion dollars of Disney titles.
The listed rail giants were rising after announcing agreements with three more freight worker unions on a new collective bargaining agreement. The deadline for the end of negotiations is Friday.
Two unions are still unable to reach an agreement with the companies, which raises the risk of a strike which would seriously disrupt the logistics organization in the United States and the American economy.
Pending the deadline, Union Pacific (+1.07%), Canadian National (+2.59%) and CSX (+0.81%) were picking up speed.
After having benefited only marginally from the presentation of a series of new products, in particular the iPhone 14, Apple took off on Monday (+ 2.87% to 161.88 dollars), leading the giants technologies.
© 2022 AFP
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