(New York = Yonhap News) Yoon Young-sook, correspondent for Yonhap Infomax = The New York stock market rose as the Federal Reserve (Fed) Chairman’s remarks the day before and the move to raise interest rates on government bonds.
As of 9:45 am EST on the 22nd (US time), the Dow Jones Industrial Average at the New York Stock Exchange (NYSE) stood at 34,781.48, up 228.49 points (0.66%) from the previous field.
The Standard & Poor’s (S&P) 500 index rose 26.41 points (0.59%) to 4,487.59, and the Nasdaq index, centered on technology stocks, recorded 13,931.97, up 93.51 points (0.68%) from the battlefield.
Fed Chairman Jerome Powell left open the possibility of a more aggressive rate hike the day before to contain inflation.
All three major indices showed a decline on the previous day on this news, but turned upward on this day.
“If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points in one meeting or several meetings, then we will,” Powell said.
Some market participants raised their prospects for a rate hike by the Fed in response to such remarks.
In consideration of Powell’s remarks the day before, Goldman Sachs predicted that the Fed would raise the key interest rate by 50 basis points each at its May and June meetings. Previously, both meetings were expected to raise 25bps.
UBS also said in a report that “the possibility of a 50bp hike is growing.”
The 10-year Treasury yield surpassed 2.32% the previous day following Chairman Powell’s hawkish remarks, breaking the record high since 2019. At this time, the 10-year yield traded at around 2.36%, up 7bp from the previous day.
The situation in Russia and Ukraine is getting worse day by day.
Ukrainian President Volodymyr Zelensky has called for additional sanctions from Western countries once morest Russia.
“Russian aggression has been going on for 27 days,” Zelensky said in a video address to Italian parliamentarians on the same day. do,” he said.
By sector, energy and health-related stocks fell, while financial, materials, telecom, and consumer discretionary-related stocks rose.
Financial stocks rose more than 2% on expectations that higher interest rates would boost earnings.
Nike shares rose more than 5% on the better-than-expected quarterly earnings results.
The stock price of Procter & Gamble (P&G) rose regarding 1% as investment firm Truest upgraded its investment opinion to ‘buy’.
New York-listed Alibaba shares rose more than 9% on news that it would expand its share buyback to $25 billion.
Shares of identity verification software company Octa fell more than 7% on news that its internal management system had been hacked.
New York stock market experts analyzed that despite concerns regarding Fed tightening, the market is holding up well with solid fundamentals.
“Stocks have been doing well in recent days,” Lisa Erikson of US Wealth Management told CNBC.
But some said Powell’s comments that he might be more aggressive had fueled concerns regarding a slowdown.
“The message from last week’s Fed meeting was that the Fed is going to tighten, but the US economy is resilient enough to withstand it,” said Hugh Roberts, head of analytics at Quant Insights. “The focus is on economic recovery,” he said.
He said Powell’s comments the day before had shaken some of those expectations and raised concerns that the Fed might tighten tightening faster enough to slow the economy, he said.
European stocks also rose.
Germany’s DAX index rose 0.98%, while the UK FTSE100 index rose 0.50%. The pan-European STOXX600 index was up 0.73%.
International oil prices fell.
The price of West Texas Intermediate (WTI) for April contract fell 0.60% to $111.44 per barrel, and the price of Brent for May contract fell 0.29% to $115.29 per barrel.
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