New York stocks fell this week awaiting corporate earnings and comments from Federal Reserve Chairman Jerome Powell.
In the New York Stock Exchange (NYSE) on the 6th (US Eastern time), the Dow Jones Industrial Average 30 closed at 33,891.02, down 34.99 points (0.10%) from the battlefield.
The Standard & Poor’s (S&P) 500 index closed at 4,111.08, down 25.40 points (0.61%) from the battleground, and the Nasdaq closed at 11,887.45, down 119.50 points (1.00%).
Investors appear to be taking profits while keeping an eye on company performance and Chairman Powell’s Washington DC Economic Club debate scheduled for the following day.
Chairman Powell is very likely to repeat his comments at last week’s press conference, but attention will be paid to see if he will make comments indicating that there are significantly lower expectations of a rate cut within the year given that employment has increased significantly since then.
Friday’s employment report has investors worried that the high interest rate environment created by the Fed may last longer than expected.
According to the Chicago Mercantile Exchange (CME) FedWatch, traders expect the Fed to raise rates by another 0.25 percentage points in May after raising rates by 0.25 percentage points in March.
A week ago, the possibility of freezing rates in May was more than half.
The employment trend index also improved due to the favorable employment trend in January.
The Conference Board’s employment trend index (ETI) for January this year was 118.74, up from the previous revision of 117.06.
This is the second consecutive month of rise, and the index is a leading index for the employment market, meaning that an increase in the index is likely to increase employment.
Concerns about corrections remain as the stock market rises rapidly in the short term.
Goldman Sachs raised its three-month forecast for the S&P 500 from 3,600 to 4,000, but kept its year-end forecast at 4,000.
Goldman Sachs pointed out that a soft landing, that is, growth that is actually greater than the trend, has already been reflected in the stock index, and the forward 12-month P/E ratio is 18.4 times, which is high compared to historical levels.
BITG Research chief technical analyst Jonathan Krinsky also saw 4,200 as strong resistance, saying the S&P 500 was up 20% from its October low.
He predicted that the index would not go down from this level for a long time.
The company’s results so far have generally exceeded expectations.
According to Refinitiv data, around half of the companies listed on the S&P 500 have so far announced their earnings.
Walt Disney, Chipotle, DuPont and PepsiCo are expected to report earnings this week.
Ahead of the opening, shares of Tyson Foods, a meat processing company, fell nearly 5% on news of weaker-than-expected earnings.
Shares in clothing maker Children’s Place fell more than 4% as the company warned of a sharp drop in profit and loss.
PayPal’s share price fell by more than 3% on the news that Raymond James has downgraded its investment rating from ‘Above market rate’ to ‘Mark rate rate’.
Dell shares fell about 3% amid news that it is cutting about 5% of its workforce.
Tesla’s share price rose more than 2% amid news that Wedbush raised its price target from $200 to $225, saying Chinese demand would act as a tailwind.
Meme stock rose again as well.
Bed Bath & Beyond’s stock surged 92% despite fears of an imminent bankruptcy filing.
During the intraday, it rose 120% once, and stock trading was suspended twice.
AMC Entertainment’s stock price also rose more than 11% on the rebound of Meme stock.
GameStop’s share price also rose more than 7%.
Of the 11 sectors in the S&P 500 index, all but utilities and consumer staples declined.
Stocks related to telecommunications, technology and materials fell more than 1%.
New York stock market experts pointed out that the market may be aware of the reality of interest rate projections.
“What is driving the market this year is some optimism about global growth, including in Europe and China, combined with expectations that rate rises will be modest or that rates will be cut once they arrive their peak,” Edward Smith, chief co-investment officer at Rasbons, told The Wall Street Journal. It seems to have worked,” he said.
“Perhaps the sell-off of the last few days is a realization that the market has been crazy in terms of interest rates,” he said, considering how quickly prices have risen. “We still have a long way to go.
(Inflation) will prevent the Fed from lowering interest rates,” he said.
“Good news has turned into bad news for the market, with a stronger than expected employment report,” said Mark Harquet, head of investment research at Nationwide.
“It was too early to see institutional investors, who were largely waiting to see, rush to liquidate their losing positions late last week,” he said.
Individual investors seem rather calm and relatively cautious while many emotions trigger institutional investors,” he added.
According to the Chicago Mercantile Exchange (CME) FedWatch, at the close of the Federal Funds (FF) interest rate futures market, the probability that the US Federal Reserve would raise the benchmark rate by 0.25 percentage points in March was record 93.7% chance. .
This is down slightly from 97.4% the previous day.
Instead, the possibility of an increase of 0.50 percentage points rose from 0% the day before to 6.3%.
The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) showed 19.43, up 1.10 points (6.00%) from the battleground.
/happy news
