The leading index Dow Jones Industrial saw another significant rise in yields on the US bond market
pushed a little further into the red on Friday. Rising interest rates, for example, make bonds more attractive as an alternative to investing in stocks. Disappointing business figures from the sporting goods manufacturer Nike and losses in bank shares were another burden.
The Dow fell 0.36 percent to 32,744.38 points after peaking the day before and then closing with slight losses. From a weekly perspective, this indicates stagnation.
The S&P 500 made up for losses on Friday and was last 0.25 percent higher at 3925.35 points. The tech-heavy Nasdaq 100 recovered somewhat more clearly from its previous day’s losses and rose by 0.77 percent to 12,887.15 points. He had suffered on Thursday with a minus of more than 3 percent under the prospect of a deterioration in financing conditions in the face of further increases in market interest rates.
Stock marketers justified the latest rise in yields with the fact that the US Federal Reserve is surprisingly allowing a support measure taken during the Corona crisis to expire. Specifically, it concerns an exception to the SLR equity rule. The rule stipulates how much equity the banks must hold for various assets on their books in order to compensate for possible losses.
The Fed’s decision was not exactly expected, as some market participants had advocated an extension. On the US bond market, which is affected by the changes, prices fell noticeably. In return, yields rose – presumably out of concern that demand for government bonds could now decline.
Against this backdrop, bank stocks did not suffer well at the end of the week. So Goldman Sachs fell by just under one percent and JPMorgan by almost three percent. However, both shares had reached record highs the day before and thus profited from rising bond yields – in the hope of better interest rate deals.
Nike stocks plummeted among the weakest stocks in the Dow
by around four percent. The world’s largest sporting goods manufacturer continues to benefit from the online shopping boom in the corona pandemic. But analysts had expected higher revenues.
At the end of the index, Visa creased by more than five percent. According to a press report, the credit card giant is targeted by the US Department of Justice. The authority is investigating on suspicion of possible anti-competitive practices, wrote the Wall Street Journal, citing people familiar with the matter. The investigators are therefore examining whether the group could have prevented merchants from processing debit card payments via cheaper networks. A Visa spokesman did not want to comment on the report.
Fedex shares were among the biggest winners in the S&P 500 by a good six percent. The post rival
earned significantly better in the most recent fiscal quarter thanks to the order boom in the pandemic. The profitability in the parcel division Ground is back on track, wrote analyst Thomas Wadewitz from the Swiss bank UBS. The sales development in the express business is also impressive./la/fba
ISIN US2605661048 US6311011026 US78378X1072
AXC0287 2021-03-19 / 18: 59
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