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New York (AFP) – The New York Stock Exchange smiled once more on Wednesday, ending sharply higher, thanks to better consumer morale in the United States and encouraging first corporate results.
The Dow Jones index gained 1.60% to 33,376.48 points, the technology-dominated Nasdaq 1.54% to 10,709.37 points and the broader S&P 500 index advanced 1.49% to 3,878, 44 dots.
“Stocks rallied on the back of rebounding consumer confidence and strong earnings from Nike and Fedex,” commented Edward Moya of Oanda.
Trading that had started marginally in the green on Wall Street accelerated to the upside following the release of the Conference Board’s Consumer Confidence Index.
The survey shows a stronger than expected rebound in consumer sentiment to 108.3 points from 101.4 points in November, a peak since April.
“This good performance of household confidence is a headache for investors who expect the economy to quickly fall into recession,” admitted Edward Moya.
It is in particular the recent declines in gasoline prices that have restored confidence to households whose inflation expectations are now at their lowest since September 2021, also underlined the Conference Board survey.
For Edward Moya, the fact remains that, because of the repeated rate hikes by the American central bank (Fed) and the global slowdown, the United States economy “is still heading towards a recession, but the consumer continues to show signs of resilience that might delay a significant fall in equities.”
For Peter Cardillo of Spartan Capital, a rebound in the stock market at the end of the year, also called the “Santa Claus Rally” (rebound of Santa Claus), was not excluded while the S&P 500, the most representative index of the market American, is approaching 4,000 points once more.
Encouraging corporate results also boosted the Dow Jones, noted analysts at Schwab, pointing to performances from Nike and Fedex that rubbed off beyond their respective sectors.
Nike shares jumped 12.29% to $115.89 as investors celebrated much better-than-expected Q2 results for the sportswear maker.
The brand, which suffered from too large an inventory, partially sold its stocks while managing to increase its turnover by 17%, more than analysts expected.
Retailers like Macy’s (+1.31%) or the sporting goods chain Dick’s (+3.20%) took advantage of this enthusiasm.
Craftsman e-commerce site Etsy soared 5.69% to $134.33 following an analyst reported promising download volumes for its app this holiday season.
Fedex stock also stood out, climbing 3.43%. The express carrier announced Tuesday following the closing of new savings measures which should allow it to compensate for a slowdown in its activity.
In the case of Nike, the enthusiasm of investors “is that demand for its products is still strong and that its inventory problems are behind it,” said Patrick O’Hare of Birefing.com.
“In Fedex’s case, it’s more rooted in the company’s desire to preserve its margins by further reducing its costs,” he added. Its competitor UPS also followed the trend (1.75%).
The energy sector was the big winner of the session (+1.89%), in the wake of an acceleration in crude oil prices, ahead of the industrial sector and banks.
Tesla shares, which had dropped 8% on Tuesday amid the cacophony of Elon Musk’s intentions over Twitter, temporarily climbed back into the green before finally falling 0.17% at the close at $137.57. , a new low for a year.
Elon Musk announced Tuesday evening to leave the head of Twitter as soon as he has “found someone crazy enough” to succeed him.
In three months, the title of the electric vehicle manufacturer had lost nearly 55% of its value on Wall Street, and more than 33% since the takeover of Twitter.
© 2022 AFP
