PARIS (Reuters) – The New York Stock Exchange opened lower on Monday, penalized by a rise in interest rate hike expectations after statements by an official of the United States Federal Reserve (Fed) that the institution was still far from the peak of its monetary tightening.
In early trading, the Dow Jones index lost 19.54 points, or 0.06%, to 33,728.32 points and the broader Standard & Poor’s 500 fell 0.50% to 3,972.72 points.
The Nasdaq Composite lost 1.18%, or 133.27 points, to 11,190.05.
Christopher Waller, one of the governors of the US central bank, said on Sunday that the Fed may consider slowing the pace of rate hikes in December but that should not be considered a “slackening” in its commitment to reduce inflation.
He also believes that the markets should now focus on the “rate peak”, even if we are still probably “far from it”, and not on the pace of each increase, deeming other data necessary than the only figures of inflation published last week which showed a more marked slowdown than expected.
The week will be marked by the publication of October retail sales in the United States on Wednesday and statements by other Fed officials which will provide investors with new clues on the path of rates.
Goldman Sachs said on Sunday that it anticipates a “significant” drop in inflation in the United States next year with a core PCE index at 2.9% against 5.1% currently.
Markets are currently pricing in a 50bp interest rate hike in December to 4.25%-4.5%, followed by two more 25bp hikes, which would see them peak in the 4.75 range. %-5.0%, according to the Fedwatch barometer..
In values, Meta Platforms, Apple and Amazon yielded from 0.64% to 2.84% while the yield of ten-year Treasuries advanced by around 3.5 basis points to 3.86% and that of two years by 8.2 points at 4.40%.
Biogen and Eli Lilly take 3.32% and 1.09% respectively after Roche’s setback in two clinical trials of an Alzheimer’s drug candidate.
(Written by Claude Chendjou, edited by Kate Entringer)
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