(CercleFinance.com) – The New York Stock Exchange went up on Friday morning following the publication of inflation statistics that seemed to rule out the threat of an acceleration in rate hikes.
At the very end of the morning, the Dow Jones advanced 0.5% to 34,304.2 points, while the Nasdaq Composite rose more markedly, winning 1.4% to 13,781.7 points.
According to the Commerce Department’s monthly report, the rise in the PCE price index excluding food and energy – the Fed’s preferred measure of inflation – slowed to +4.6% in May, from +4.7 % in April.
From the point of view of investors, the slowdown in the rise in basic prices partly reduces the pressure on the shoulders of the Fed, which was alarmed last week by the persistence of inflation.
The unaccommodating remarks made last week by its chairman, Jerome Powell, before Congress, had indeed fueled speculation of at least two further rate hikes by the end of the year, which had raised the dollar and bond yields, and decline in equity markets.
According to analysts, the Federal Reserve may be encouraged by the deceleration in the rise in the price of services, the strength of which it was beginning to find worrying.
‘We know that this measure of inflation will have a decisive influence on monetary policy by the end of the year,’ recalls Jack McIntyre, manager at Brandywine Global, a subsidiary of Franklin Templeton.
“I am still among those who expect inflation to fall more sharply in the second half of 2023 and then in 2024 under the effect of the aggressive monetary tightening that has already taken place,” he adds.
The 10-year Treasuries yield is down following the inflation report to around 2.82% from 2.85% yesterday, while the dollar loses ground against all the reference currencies including the euro, which oscillates around 1.0910 dollar.
On the values front, Apple has again become, with a gain of 1.6%, the first American listed group to cross the threshold of 3,000 billion dollars in market capitalization.
Nike fell 3% at the start of the session after a publication in respect of the fourth accounting quarter described as “mixed” by analysts who also point to the “a bit fair” prospects for the sports equipment manufacturer.
Disney (-0.2%) continues its decline from the day before, following a deterioration in the recommendation of KeyBanc analysts who say they prefer to stay away because of the uncertainties surrounding the activity of the media giant.
Constellation Brands advances by 0.4% after announcing for its first quarter 2023-24 an EPS up 9% to 2.91 dollars on a comparable basis and an operating profit increased by 4% to 827 million dollars.
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