(CercleFinance.com) – The New York Stock Exchange opened higher Monday morning, but rebounding bond yields are preventing it from starting the year on new highs.
At the end of the morning, the Dow Jones index even returned to its equilibrium point, at 36,339.9 points, while the Nasdaq Composite advanced 0.6% to 15,742.1 points.
Up 0.1%, the S&P 500 is once again approaching without reaching its all-time high of 4,808.9 points.
Since the session kicked off, the major New York indices have lost half of their initial gains and may not be able to register new closing highs tonight.
On the bond front, the year 2022 begins with a heavy fall in T-Bonds and a very sharp tension at the level of the 10-year paper, the rate of which is back above the 1.61% bar.
For the record, a rise in real rates is deemed unfavorable to riskier assets such as stocks, since higher yields reduce the present value of future cash flows, dividends and earnings.
The few economic indicators of the day did not support the recent optimism of investors.
The PMI index of the US manufacturing sector – calculated by IHS Markit – thus stood at 57.7 in final data in December, the lowest since October 2020, against a flash estimate which was 57.8, and after a level of 58.3 recorded in November.
This slight month-on-month decline reflects, according to IHS Markit, severe material shortages affecting order intake and manufacturing output.
On the value side, Tesla jumped 9% after announcing the delivery of more than 308,000 vehicles during the fourth quarter of 2021, or more than 936,000 over the past fiscal year.
These figures are much higher than the estimates which had been established by the consensus.
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