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New York (AFP) – The New York Stock Exchange closed modestly in the red on Wednesday, regaining ground at the end of a much more negative session, due to the rise in bond rates and following the sharp rebound at the start of the week.
The Dow Jones index fell 0.14% to 30,273.87 points, the Nasdaq dropped 0.25% to 11,148.64 points and the S&P 500 0.20% to 3,783.28 points, while the three indices were down more than 1% during the day.
“This morning, the market was in a phase of caution in the face of talk of a possible pivot from the Fed on rate hikes, but then stocks rallied well,” summarized for AFP Karl Haeling of LBBW.
Yields on Treasuries started to rise once more following falling in recent sessions, betting on a possibly more lenient Federal Reserve on interest rate hikes following several lackluster US economic indicators. They amounted to 3.74% once morest 3.63% at 8:00 p.m. GMT for ten-year bonds.
Despite these bond tensions, equities slowly regained ground at the end of the day: “I think we are in a waiting pattern before the US employment report on Friday”, suggested Karl Haeling.
The analyst also pointed out that following an oversold market at the end of last week, investors may be positioning themselves in anticipation of two other important events: the CPI inflation index for September, which will be published on next week, and the start of the corporate earnings season.
On the energy front, crude prices accelerated following the decision, announced on Wednesday, by the Organization of the Petroleum Exporting Countries (OPEC) and their allies in the OPEC+ agreement to cut production by two million barrels per day.
The price of a barrel of Brent gained 1.70% to 93.37 dollars, the highest since September 15. US WTI rose 1.43% to $87.76.
Among the indicators, the American economy continued to create solid jobs in September, according to the ADP survey on hirings in the private sector (+208,000, more than expected).
Investors are awaiting official labor market figures on Friday: the September unemployment rate is expected to remain stable compared to August, at 3.7%, and 275,000 job creations are expected.
On the services side, growth in activity remained broadly stable at 56.7% in September, posting a level a little better than expected, according to the barometer of the professional federation ISM.
Thanks in particular to these favorable data, the dollar recovered and pushed the European currency down by 1%, to 0.9884 dollars for one euro at 8:00 p.m. GMT.
On the side, the energy sector, driven by the rise in crude prices, pranced in the lead (+ 2.06%) with increases of more than 4% for Exxon Mobil or Halliburton, and more than 6 % for Schlumberger.
Information technologies did well (+0.36%). Snap, parent company of Snapchat, gained 3.4%.
Twitter lost few points (-1.35% to 51.30 dollars) following jumping 22% the day before following Elon Musk’s theatrical coup. The wealthy and whimsical boss of Tesla has relaunched his offer to purchase on the social network two weeks before a trial where he was prosecuted for breach of promise to purchase.
This reversal did not prevent the judge in charge of the dispute between Twitter and the multi-billionaire entrepreneur from indicating that the trial was still on the agenda for October 17, as long as the two parties had not requested officially the stay of proceedings.
Tesla shares fell another 3.46% to $240.81. Since Friday, the action has melted by 9%.
© 2022 AFP
