PARIS, July 11 (Reuters) – The New York Stock Exchange opened lower on Monday amid caution as the big-corporate earnings season kicked off, which could see slower earnings growth due runaway inflation and a rapid rise in interest rates.
In early trading, the Dow Jones index lost 72.98 points, or 0.23%, to 31,265.17 points and the broader Standard & Poor’s 500 fell 0.53% to 3,878.38 points.
The Nasdaq Composite lost 0.87%, or 101.76 points, to 11,533.54.
While the banks JPMorgan Chase (-0.7%) and Morgan Stanley (-0.8%) will open the ball for second quarter results on Thursday, the consensus is for a rise of only 6% over one year in profits. Standard & Poor’s 500.
Expectations of a three-quarter point rate hike by the Fed this month are not helping major US banks, whose sector index is down 0.52% so far.
“Investors fear not only that earnings will decline due to an economic slowdown, but also because of the rise in the US dollar which is unfavorable for the profits of multinationals,” said Robert Pavlik, portfolio manager at Dakota Wealth.
According to this expert, banks could also be penalized by the weakness of trading and advisory activity.
In other values, Twitter fell by 6.4%, Elon Musk having announced on Friday that he was ending the agreement to buy the social network for 44 billion dollars (43 billion euros), accusing the group of not having provided exact data on the number of fake accounts and spam.
New health restrictions in China to contain the spread of COVID-19 weigh on casino operators such as Las Vegas Sands, Wynn Resorts, Melco Resorts and MGM Resorts which are down 2% to 6% after the closure in Macau of all establishments industry for the first time in more than two years.