PARIS (Reuters) – The New York Stock Exchange opened in disorganized fashion on Friday after statements by a US Federal Reserve (Fed) official which tempered the prospect of an imminent reduction in interest rates.
About ten minutes after the first exchanges, the Dow Jones index lost 42.86 points, or 0.12%, to 37,205.49 points and the Standard & Poor’s 500, broader, fell by 0.06% to 4,716, 49 points.
The Nasdaq Composite, on the other hand, gained 0.37%, or 54.13 points, to 14,815.69.
John Williams, the president of the New York Fed, said on CNBC that it was “premature” to think about cutting rates.
On the money markets, the probability of a reduction in the interest rate by the Fed by at least 25 basis points from March 2024 has fallen to 64.3% compared to a probability of almost 80% before the interview granted to CNBC.
“It’s not unusual for Fed leaders to try to walk away from outsized reactions to a particular Fed meeting, whether positive or negative,” says Art Hogan, chief market strategist at B Riley Wealth.
On the bond market, the yield on ten-year US Treasury bonds, which fell on Thursday to its lowest level since July, below 4%, was stable on Friday.
Before the opening of Wall Street, futures contracts suggested a session in the green in the wake of the decisions of the Fed which maintained on Wednesday the target for “fed funds” rates at 5.25%-5.50 % for the third time in a row, while its president Jerome Powell indicated that rates were approaching their peak.
In terms of values, the semiconductor (+0.55%) and technological news (+0.56%) compartments are up with Nvidia (+0.80%), Intel (+2.30%), Microsoft (+1.13%) or even Alphabet (+0.93%)
Costco Wholesale rose 2.85% after publishing quarterly sales above consensus.
General Electric (+1.54%) benefits from the increase in Wells Fargo’s recommendation to “overweight”, while BlackRock loses 1.08% JPMorgan having lowered its advice to “neutral”.
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(Written by Claude Chendjou, edited by Jean-Stéphane Brosse)
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