(CercleFinance.com) – Disappointing session on Wall Street which was a little hesitant at the opening (the S&P500 was content with +0.1% and the Nasdaq remained heavy with a decline of -0.2%) but the US indices quickly embarked on the path of increase with +0.7% for the Dow Jones (which returned to 38,000), +0.5% for the ‘S&P’, +0.4% on the Nasdaq towards 15,750 Points ), which allowed European places to perform well.
But the resurgent interest rate tension got the better of these upward impulses: the morning’s improvement fizzled out and the yield on ten-year American Treasuries rebounded by +5 points towards 4.636%, a level close to the five-month highs. reached on Tuesday, the ‘2 years’ is once again close to 5.00% (at 4.995%).
As a result, the US indices closed in decline, or at the lowest of the day with the Dow Jones barely surviving (+0.05%) thanks to the very defensive United Health.
On the other hand, the S&P500 fell by -0.25%, the Nasdaq by -0.52% (to 15,600) and the Nasdaq-100 by -0.57% in the wake once again of the semiconductors and the giants ‘tech’ like Micron -3.8%, NXP -3.3%, Applied Materials -2.8%, Cadence -2.7%, KLA -2.2%, Autodesk -2%, Broadcom, Intel and Microsoft -1.8%.
The Nasdaq seems to be heading straight towards a 4th consecutive week of consolidation (and tomorrow would be the worst week since the end of October) and the 6th in a series of 7.
Note outside the USA the fall of -5.4% for the Taiwanese giant TSMC… after -7% the day before for its Dutch competitor ASML.
Shortly after the close, Netflix fell by -5% after publication of its quarterly results (rather in line with expectations): investors were stunned by the announcement that the quarterly publication of new subscribers and revenue per subscriber will be suspended from the 1st quarter 2025.
Despite the drop in the ‘S&P’, the ‘VIX’ eased by -1.1% towards 18.00 as the prospect of a conflagration in the Middle East receded a little.
On the other hand, trade relations with China will continue to become strained with Joe Biden’s plan to triple taxes on Chinese steel imports.
Today’s US macroeconomic data has fueled fears that high rates will remain high for a longer period than expected so far (less than 20% of investors still believe a rate cut in June is possible, barely more than 40% in July).
The ‘Philly FED’ index, calculated by the Philadelphia Fed, rose 12 points to 15.5 in April, its third consecutive positive figure and its highest level since April 2022… while the consensus was expecting a decline of -1.5Pt.
‘Nearly 38% of manufacturing companies reported an increase in general activity this month, while 22% reported declines; 40% reported no change,’ the investigators said.
They added that the index of new orders rose seven points in April, its second consecutive positive figure, and that of current shipments rose eight points to 19.1.
The number of registered unemployed remained stable at 212,000 while a slight weekly increase in applicants was expected (to 215,000).
The index of leading indicators, supposed to foreshadow the evolution of economic activity in the United States, fell again in March, announced the Conference Board, which sees this as a sign of slowing growth.
The leading index fell by 0.3% last month, to 102.4, after an increase of 0.2% in April, the employers’ organization said in a press release this Thursday.
The ConfBoard evokes ‘fragile’, even ‘recessionary’, prospects for the American economy, which it considers penalized by increasingly high household debt, high interest rates and persistent inflation.
From his point of view, growth should tend to slow down in the second half of the year, which leads him to anticipate a deceleration in GDP growth in the second quarter, then in the third quarter.
Sales of existing homes in the United States fell 4.3% between February and March to stand at 4.19 million on an annualized and seasonally adjusted basis (CVS), according to the National Federation of Real Estate Agents. (NAR).
The median sales price reached $393,500, up 4.8% year-on-year, and the stock of unsold existing homes increased by 4.7% to stand at 1.11 million at the end of March, or 3 .2 months of stocks at the current flow rate.
The few signals of weakness in the US economy do not impress the boss of the IMF, Kristalina Georgieva, who revises upwards the growth prospects for the United States, which is accumulating record debt.
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