New York (AFP) – The New York Stock Exchange was moving in scattered order shortly following the opening on Thursday, rather stimulated by a series of better than expected indicators and now the hope of a soft landing for the American economy.
Around 3:00 p.m. GMT, the Dow Jones yielded 0.14%, the Nasdaq index gained 0.86% and the broader S&P 500 index took 0.31%.
Growth reached 2.9% year on year in the fourth quarter in the United States, better than the 2.8% announced by economists, the US Commerce Department said on Thursday.
“The main lesson of this report is that the (US) economy was far from being in recession in the fourth quarter,” commented Patrick O’Hare of Briefing.com in a note.
“Hope remains for a soft landing for the economy, but the track record of the Fed (US central bank) in this area is not encouraging,” reacted, in a note, Oren Klachkin, of Oxford Economics. .
The impression was reinforced by new weekly jobless claims, which fell to their lowest level since April 2022, and the surge in durable goods orders in December (+5.6%), the pace of which more than doubled. what economists expected (+2.5%).
The growth report also contained quarterly data on the evolution of the PCE price index. According to Ian Shepherdson of Pantheon Macroeconomics, the figures suggest that the core index (excluding energy and food) is around 0.3% in December, which would be in line with forecasts and confirm a slowdown in inflation. The PCE index for December alone will not be released until Friday.
“You see inflation decelerating and the economy staying relatively strong, and that’s good for stocks, which is why the market is going up,” said Adam Sarhan of 50 Park Investments.
“All of this suggests to me that this is the end of the bear market” that Wall Street has been in since the start of 2022, “and it’s only a matter of time before we begin some upward momentum.” , he added.
The good macroeconomic indicators caused a slight tension in the bond market, as they might encourage the Fed to continue its rate hikes, at its meeting next week, but also beyond.
The yield on 10-year US government bonds stood at 3.48%, once morest 3.44% the day before closing.
Listed, Tesla jumped (+ 8.41% to 156.57 dollars), the day following the publication, Wednesday following the stock market, of record results and better than expected. Investors did not hold it once morest the manufacturer for the slight contraction in its margins, following, in particular, price cuts.
Chevron was wanted (+ 2.75% to 184.01 dollars) following announcing, Wednesday following the stock market, the launch of a new share buyback program, for a maximum amount of 75 billion dollars, one of the most massive ever seen.
Mastercard fell (-2.33% to 373.48 dollars) despite better than expected results. “While macroeconomic and geopolitical uncertainty persists, consumer spending is showing remarkable resilience,” said CEO Michael Miebach.
Its competitor Visa was also in the red (-0.40% to 224.01 dollars). The credit card and payment specialist posted a net profit below analysts’ expectations. He also spoke of consumer “resilience” and the resurgence of global tourism.
Southwest was penalized (-4.41% to 35.24%) for the publication of a net loss of unexpected magnitude, mainly attributable to the monster disruptions experienced by the company during the passage, at the end of December, of the storm winter Elliott, which cost him $800 million.
Its rival American Airlines was also down (-1.57% to 16.00 dollars), although it did better than estimates in the fourth quarter.
The chemical industry giant Dow also suffered (-3.22% to 56.03 dollars), following recording a drop in its quarterly turnover (-17% over one year) due to a slowdown in the economy which affects all of its activities. Dow has launched a billion dollar savings program, which includes the elimination of 2,000 jobs.
The announcements of social plans have been multiplying for several weeks. Wednesday was the turn of the computer company IBM (-4.27% to 134.75 dollars) to unveil a program of 3,900 job cuts.
During the press conference call presenting the group’s results, the chief financial officer indicated that it was “prudent” to anticipate growth at the bottom of the group’s usual range.
© 2023 AFP