The fall in U.S. bond yields boosted some high-growth stocks higher. Investors focused on the content of Federal Reserve Chairman Powell’s speech in the House of Representatives later. U.S. stocks were mixed on Thursday (23rd).
Before the deadline, the Dow Jones Industrial Average rose more than 150 points or nearly 0.5%, the Nasdaq Composite Index edged up 20 points or nearly 0.2%, the S&P 500 Index rose nearly 0.4%, and the Philadelphia Semiconductor Index fell nearly 1%.
Powell will testify before the House Financial Services Committee later today and be questioned by lawmakers on the U.S. economy, monetary policy, inflation and other issues.
Powell admitted in the Senate Banking Committee yesterday that sharp interest rate hikes may lead to a recession in the U.S. economy, but the Fed needs to see strong evidence of lower inflation before changing the path of interest rate hikes, believing that the U.S. economy can withstand further tightening of monetary policy, Also called a successful soft landing “very challenging.”
Wall Street traders are currently debating how long the Fed will extend its rate hike cycle amid a downturn. Money markets showed less chance of a rate hike after the Fed’s year-end meeting, while a higher chance of a rate cut starting in May next year.
In terms of economic data, the U.S. Department of Labor released the latest data showing that the number of people receiving unemployment benefits last week was 229,000, a decrease of 2,000 from the previously revised 231,000, which was higher than market expectations of 227,000 and close to a 5-month high. point, indicating that labor market tightening may be starting to ease. Last week, the number of people receiving unemployment benefits reported 1.315 million, in line with market expectations.
In terms of energy, investors may hit demand due to a new economic recession, and international oil prices continue to fluctuate. On the other hand, Russian President Vladimir Putin publicly announced that he will turn Russia’s oil and trade to the BRICS countries, and is cooperating with the BRICS countries to develop an international financial settlement mechanism to reduce dependence on the US dollar and the euro.
As of 21:00 on Thursday (23rd) Taipei time:
Stocks in focus:
Accenture (ACN-US) rose 2.34% to $279.71 a share in early trade
Accenture, an IT services company, reported revenue of $16.16 billion for the quarter ended May 31, beating analysts’ average forecast of $16.03 billion, although profit was affected by exit costs in Russia.
Although Accenture raised its full-year financial forecast, it lowered the upper end of its forecast range due to a stronger-than-expected negative exchange rate impact, forecasting fourth-quarter revenue to be between $15 billion and $15.5 billion. Analysts on average expected $15.7 billion, according to IBES data from Refinitiv.
WeWork (WE-US) rose 8.48% to $5.88 per share in early trade
Co-working space company WeWork was favored by investment bank Credit Suisse, and its stock rating was upgraded to “outperform.” Credit Suisse said that WeWork is expected to benefit from an increase in the trend of hybrid office models in the future.
Snowflake (SNOW-US) rose 4.61% to $133.28 a share in early trade
JPMorgan raised its rating on cloud computing company Snowflake to “overweight” from “neutral”, citing Snowflake’s attractive valuation and high customer satisfaction. Snowflake shares rose more than 6 percent in premarket trading.
Today’s key economic data:
- The number of people receiving unemployment benefits last week was 229,000, expected to be 227,000, and the previous value of 231,000
- Last week, the number of people receiving unemployment benefits reported 1.315 million, 1.315 million is expected, and the previous value was 1.31 million
- U.S. June Markit manufacturing PMI initial value was 52.4, expected 56, the previous value was 57
- U.S. June Markit services PMI initial value was 51.6, expected 53.5, the previous value was 53.4
- U.S. June Markit Composite PMI preliminary value was 51.2, the previous value was 53.6
- US Q1 Current Account – $291.4 billion, expected – $273.5 billion, prior – $217.9 billion
Wall Street Analysis:
Silvia Dall’Angelo, senior economist at Federated Hermes, wrote in the report that while inflation may be close to peaking, inflation will remain high in the second half of the year, causing uneasy factors for central banks.
Esty Dwek, chief investment officer at Flowbank, said the Fed reiterated its commitment to fighting inflation and viewed a recession as a risk, adding to concerns about economic growth.
CMC markets market analyst Michael Hewson said lower U.S. bond yields and some safe-haven buying suggested the market may be starting to worry about some form of slowing economic growth, and that concern is reflected in copper and oil prices, leading to Stocks were slightly weaker.
Baird’s Spencer said the market has been hit so hard that the recession has largely been priced in, but he sees the worst-case scenario as a mild recession, where stocks are in the process of bottoming out and may only drop another 5%.