Wall Street opens lower, risk aversion increases


PARIS, May 19 (Reuters) – The New York Stock Exchange opened lower again on Thursday a day after its worst session in two years, as investors remained extremely cautious about the impact of inflation on the economy and business results.

In early trading, the Dow Jones index lost 192.93 points, or 0.61%, to 31,297.14 points and the broader Standard & Poor’s 500 fell 0.37% to 3,909.07 points.

The Nasdaq Composite is practically stable (-0.01%) at 11,410 points.

The American retail group Target, which threw a chill on the markets on Wednesday after a quarterly profit cut in half by rising costs, continues to fuel fears of a drop in consumption and a risk of recession. while inflation is at record highs.

The consumer goods compartment and that of the consumption of goods and services considered non-essential fell by 1.2% and 0.1% respectively.

Goldman Sachs now assesses the risk of a recession within two years in the United States at 35% and Morgan Stanley at 25% such a probability within 12 months. Wells Fargo Investment Institute, for its part, has revised down its forecast for the growth of the American economy, assuming in its base scenario a slight recession for the end of the year and the beginning of 2023.

The monthly survey by the local branch of the Federal Reserve also shows that business conditions in the Philadelphia area have deteriorated sharply????????? in May, with an index of 2.6, the lowest since May 2020.

Jobless claims last week in the United States also rose faster than expected, to 218,000.

In values, the distributor Kohl’s, which is looking for a buyer under pressure from activist investors, fell 7.2% after lowering its annual profit target due to the heavier than expected impact of rising costs. Walmart and Target lost 1.2% and 1.3% respectively.

In high technology, Cisco plunged 10% after also lowering its revenue growth forecast for this year due to health restrictions in China and the war in Ukraine.

The heavyweights in the sector are falling slightly, like Apple, Alphabet and Tesla.




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