(Boursier.com) – Wall Street appears in dispersed order at the start of the session on Monday, after a brutal purge at the end of last week (-1.62% on Friday on the DJIA and -1.8% on the Nasdaq) . The S&P 500 climbed 0.03% to 3,694 pts today, the Dow Jones lost 0.35% to 29,488 pts and the Nasdaq rose 0.66% to 10,939 pts. A barrel of WTI crude is now up 1.2% to $79.7. An ounce of gold lost 0.2% to $1,653. The dollar index advanced 0.2% against a basket of currencies.
On the economic front in the United States today, the Chicago Fed National Activity Index for the month of August came out at … zero (consensus 0.25 according to FactSet, against 0.27 a month before). The Dallas Fed’s manufacturing index for the month of September came out bright red, at -17.2, against -5 consensus and -12.9 a month before.
Elsewhere in the world, Japan’s Markit/JMMA Preliminary Manufacturing PMI came in line with expectations at 51 for September. The German Ifo business climate indicator for September came in at 84.3, well below the FactSet consensus of 87 and down sharply from 88.6 in September. ‘august.
Finally, the day would be cruelly incomplete without a bit of ‘fedspeak’. Loretta Mester, President of the Cleveland Fed, will speak during the day. It will no doubt be able to remind the financial markets, already plunged into depression, of the Fed’s firm commitment to bring down inflation, at the cost of additional economic suffering.
According to the real-time FedWatch tool, the current probability of further Fed monetary tightening of 75 basis points on Nov. 2 after the next monetary meeting is nearly 70%, which would bring the range of the fed funds rate between 3.75 and 4%. The probability of a slightly less vigorous move of 50 basis points is 30.3%. The Fed raised rates between 3 and 3.25% last week, raised by 75 basis points for the third consecutive time, the first time since Paul Volcker. The monetary tornado should therefore continue, Jerome Powell himself having affirmed the determination of the Fed to “finish the job”, despite the major risk of recession.
The recent surge in the dollar is of great concern to Michael Wilson, the head of US equity strategy at Morgan Stanley. Quoted by the Bloomberg agency, the specialist notes that the recent rally in the greenback is creating an untenable situation for risky assets, including of course equities. The expert recalls that in the past, this sort of solidity of the dollar has led to economic or financial crises. “While it is difficult to predict such events, the conditions are in place for them to happen,” Wilson said, referring to crises such as those of 2008, 2012 (sovereign debt) or 2000 (internet bubble ). The US dollar has gained 19% this year, while US equity markets have lost 23%.
The specialist of Morgan Stanley sees an eventual bottom on the S&P 500, broad US index, later this year between 3,000 and 3,400 pts, an additional 13% decline for the mid-range.
Intel (steady). The outgoing Italian government of Mario Draghi and the US processor giant have reportedly chosen the Veneto region town of Vigasio as the preferred site for a new semiconductor factory in the country, two Reuters sources familiar with the matter believe. .
Li-Auto (+7%), the Chinese designer of electric vehicles listed on Wall Street, lowered its delivery forecast for the third quarter due to supply constraints.
Apple (+2%), the Californian colossus from Cupertino, has indicated that its iPhone 14 will also be manufactured in India, the apple group still trying to reduce its dependence on China.
Amazon (+2%), the American e-commerce giant, announced two days of promotions on October 11 and 12 for Prime subscribers, in fifteen countries.
McDonald’s (stable), the leader in fast food, announced a nearly 60% increase in the price of its offers in Japan, in the face of the depreciation of the yen and the surge in commodity prices.
KKR (+1%). The consortium led by the American fund today withdrew its offer to buy the Australian health group Ramsay Health Care for an amount of 20 billion Australian dollars, negotiations having failed.
Alphabet (+1%). Google said that sharing the cost of networks claimed by telecom operators was a 10-year-old idea and would harm consumers, as the group is already investing heavily in internet infrastructure.
Pfizer (stable), the American laboratory, has submitted to the Food and Drug Administration a request for authorization for a booster vaccination in children aged 5 to 11 years with its vaccine against Covid-19 specifically targeting Omicron.
PG&E (+4%) jumped today on Wall Street, while S&P Dow Jones Indices announced that the utilities group would join the S&P 500 on October 3, replacing Citrix (steady).
walmart (stable) enters the ‘metaverse’ with two experiences, Walmart Land and Walmart’s Universe of Play, on the gaming platform Roblox (+3%). The retailer is thus experimenting with new ways of reaching consumers.