(CercleFinance.com) – Wall Street ended the week, the month and the quarter in mixed order this Friday, with the Dow Jones down 0.47%, the S&P500 at -0.27% and the Nasdaq index slightly down. increase of 0.14%.
The quarter ended with a loss of more than 3% on the S&P and the Nasdaq, the Russell-2000 (-0.6%) lost -3.5% and returned to square one since January 1st.
The initial gains (+0.5%) did not hold despite a further easing of bond rates driven by ‘core PCE’ inflation falling below 4% for the first time since the summer of 2021 (around 3.9% ).
But a shadow hung over this session: the risk of ‘shutdown’ is estimated at 90% this weekend and each week of non-payment of civil servants costs 0.1% of GDP according to the experience of 2018 for example.
Added to this is the strike in the automobile sector which is spreading, with wage demands to which Joe Biden recommends paying attention: if they were satisfied, this could restart the inflationary spiral, especially as oil prices remain close to the record levels of late October/early November 2022.
Little movement on the exchange rates with the $-Index ending unchanged at 106.20 (it gained +0.75% over the past week).
The publication of household expenditure/income and the highly anticipated ‘PCE’ index in the United States was to constitute the ‘high point of the FED’ but far from constituting a ‘market mover’ these statistics ended in a ‘non-event ‘.
Consumer spending by American households increased by 0.4% last month compared to the previous month in the United States, according to the Department of Commerce, an increase fairly in line with expectations (the increase in fuel budgets represents the bulk of this gap), for revenues also growing by 0.4%.
But above all, the ‘PCE’ price inflation index stood at 3.5% at an annual rate in August (slightly accelerating), but this is offset by a contraction in the ‘PCE Core’ (excluding food products and energy) which fell from 4.3% to 3.9% from one month to the next.
Beware of second-round inflation in the wake of oil and the cost of the federal debt: the bill now amounts to $1,000 billion/year.
Wall Street saw its attempt at a rebound slowed down by the consolidation of oil stocks and pharmaceutical groups.
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