(CercleFinance.com) – Wall Street began a rebound on Friday thanks to both cheap buyouts on technology stocks and reassuring words from Jerome Powell, the chairman of the Federal Reserve.
At the end of the morning, the Dow Jones advanced 1.4% to 32,173.2 points, while the Nasdaq Composite climbed 3.3% to 11,748.7 points.
Some traders attribute the sharp rally in US equity markets to comments made by the Fed chief during an interview with US radio station Marketplace.
‘The central bank would still stick to rate hikes of 50 basis points at the end of its next two meetings and ‘would not actively consider’ a hike of 75 points at this stage’, summarize the teams of ‘ArgusResearch.
Jerome Powell thus eased the fears aroused by the latest US inflation figures, which showed that the rise in prices was slowing less quickly than expected, putting a little more pressure on the shoulders of the Fed to act quickly.
Under the influence of these uncertainties, the S&P 500 – the benchmark index for fund managers – had come close to entering a bear market yesterday, with a decline of almost 20% compared to its recent highs.
The rating is also driven by the rebound in technology stocks, which are benefiting from a bargain-hunting movement after a disastrous start to the year.
The S&P index comprising technology stocks picked up 2.7%, the second strongest sectoral increase behind consumption, after having fallen by more than 22% since the start of the year.
In a note published in the morning, analysts at Wedbush Securities recommend that investors favor two sure values in the sector, namely Microsoft (+2.1%) and Apple (+3%).
They also advise them to go to cybersecurity players such as Palo Alto or Fortinet, but also to ‘cloud’ specialists.
According to them, the movement towards cloud computing is far from over, with 60% of the digital transformation still to be completed, which promises a massive wave of growth for groups like Microsoft, Amazon (AWS) , Google, Salesforce and Oracle.
Twitter drops 8% as Elon Musk said in the morning that he had suspended the takeover of the company, before reaffirming a little later that he was still determined to acquire the company.
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