The floor of the New York Stock Exchange (GETTY IMAGES NORTH AMERICA/AFP/SPENCER PLATT)
The New York Stock Exchange ended Monday slightly in the green, catching its breath after posting its best week of the year.
The Dow Jones index gained 0.10% to 34,095.86 points, the technology-dominated Nasdaq advanced 0.30% to 13,518.78 points and the broader S&P 500 index gained 0.18% to 4,365.98 points.
“Last week was the best of the year for the stock market. It is completely normal and healthy to see the market take a break to digest last week’s sharp rise,” he told AFP. Adam Sarhan of 50 Park Investments.
“We have a situation where the market is slowing down to consolidate the latest movements and wait for a new catalyst to continue the momentum. This could be the words of a Fed official, of Jerome Powell (the president of the central bank ) or company results,” added the analyst.
This week, while the agenda is sparse in terms of indicators, several members of the American Federal Reserve are due to speak, including its president Jerome Powell on Thursday, during a debate at the IMF.
A final series of corporate results is also expected, including those from entertainment specialists Disney (-1.20% at closing), Wynn Resorts (+2.57%), MGM Resorts (+0.33%), Warner Bros Discovery (-2.72%) as well as Uber (+0.84%), Lyft (-1.22%) or Roblox (-2.97%).
For JPMorgan analysts, “the fall in bond yields and the accommodating decisions of central banks are interpreted by the markets as a positive element in the short term”.
But, the analysts add in a note, “we think stocks will soon rethink the profit/risk ratio in a context where the Fed will keep rates high for longer, where earnings expectations are too optimistic and where margins are in danger”.
Yields on ten-year Treasury bills stood at 4.65% compared to 4.57% on Wednesday and 5% two weeks ago.
This week, the US Treasury will launch new debt issues, including 40 billion ten-year bonds on Wednesday and 24 billion thirty-year bonds on Thursday.
“That’s a lot of debt to digest,” commented Patrick O’Hare.
In terms of indicators, it’s a quiet week with only the first estimate of consumer confidence for November, published by the University of Michigan on Wednesday.
On the stock market, automobile manufacturers fell by more than 2% such as Ford and General Motors while Stellantis lost 2.76%.
Regional banks have fared poorly as credit conditions tighten and loan demand slows across sectors, according to the Fed’s latest monthly survey of bank lending officials. Comerica dropped 2.52%, Zions Bancorportation -1.67%, and Western Alliance -2.71%.
Microprocessor manufacturer Nvidia gained 1.66% to $457, while its quarterly results are not expected until November 21.
The title of the very volatile Bumble application, which reserves the first step for women, lost 4.39% after the announced departure of its CEO Whitney Wolfe Herd. She is replaced in this position by Lidiane Jones, who comes from the professional collaborative application Slack, where she was general manager.
© 2023 AFP
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