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Wall Street just finished its worst quarter since the start of the corona pandemic – a quarter that was weighed down by the US Federal Reserve’s (Fed) interest rate hikes, high inflation and Russia’s invasion of Ukraine.
During the first three months of the year, the broad aggregate index S&P 500 fell 4.95 percent, the industrial index Dow Jones fell 4.57 percent, while the technology index Nasdaq fell as much as 9.1 percent.
On the first trading day in the second quarter, it looked brighter from the start, but the mood turned throughout the day, then the indices turned to the positive side again. This is what the indices looked like when trading stopped:
- The S&P 500 closes with an increase of 0.36 percent
- The Dow Jones rose 0.44 percent
- Nasdaq closes with an increase of 0.28 percent
«Most important figures of the month»
Friday came recent job numbers from the USA, which showed somewhat lower job growth than expected in March. A total of 431,000 new jobs were created, while the consensus estimate from Bloomberg was 490,000.
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The unemployment rate fell to 3.6 per cent in March from 3.8 per cent in February, about as expected, while wage growth jumped from 5.1 per cent on an annual basis in February to 5.6 per cent on an annual basis in March. Also it was about as expected.
The US employment figures are often referred to as “the most important figures of the month”, because the figures give an indication of how things are in the world’s most important economy.
Furthermore, investors are closely following the yield curve that has recently inverted, which has historically signaled an impending recession.
Gamestop-fall
The gaming store chain Gamestop, the “meme share” in front of some, rose sharply in after-sales on Thursday after the company announced plans for a share split on Thursday.
The share rose twelve percent from the start, but has over the day fallen back to an increase of around five percent. As the stock market closes, the share falls 1.6 percent.
Gamestop stated that it will seek approval at the next shareholders’ meeting for an increase in the number of A shares from 300 million to one billion shares in order to partially implement a split in the form of a dividend.
Chairman Ryan Cohen is leading Gamestop’s transformation towards greater digital investment. (Photo: Bill Jerome)
The share rose as much as 35 percent during the month of March, supported by its loyal following of small savers. The price got a boost a few weeks ago when chairman Ryan Cohen, who is the driver behind the company’s digitization strategy, bought another 100,000 shares and increased his ownership to 11.9 percent.
Gamestop and the other “meme” shares were first popularized at the beginning of 2021 by users of online forums such as Wall Street Bets on Reddit.
The phenomenon is explained by the fact that small investors want revenge on, and sabotage, large hedge funds that have bet on price declines in the relevant shares – preferably companies with outdated business models that are predicted north and down by analysts.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other use of all or part of the content may only take place with written permission or as permitted by law. For additional terms look here.
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