NEW YORK (awp international) – The stabilization on the US stock market continued with momentum on Thursday. Concerns about inflation and recession receded into the background, even though the US Federal Reserve (Fed) is sticking to its aggressive course of rate hikes, as the Fed minutes made clear in the middle of the week.
“It sounds somewhat paradoxical that the US Federal Reserve would provide some relief on the stock market with further interest rate hikes. However, investors interpret the determination of the Fed, which emerges from the meeting minutes on this point, as a sign of confidence in the robustness of the economy”, explained capital market strategist Jürgen Molnar from RoboMarkets. This means that the recession risks that have dominated recently have not received any new nourishment.
The Dow Jones Industrial rose 1.12 percent to 31,384.55 points, making up for the losses it had accumulated since the end of June. The market-wide S&P 500 rose by 1.50 percent to 3902.62 points and is now exactly 19 percent below its record high from January. Although it has recovered somewhat from its one-and-a-half-year low in June, it remains at the threshold at which stockbrokers speak of a bear market.
The tech-heavy Nasdaq 100 gained 2.16 percent to 12,109.05 points on Thursday. It is almost 28 percent below its peak reached in November 2021.
Positive signals for numerous technology stocks, also in the USA, came from the Korean Samsung group. In its earnings outlook for April to June, the world market leader in memory chips, smartphones and televisions is targeting significant growth. Shares of suppliers such as Applied Materials gained about 4.8 percent and Lam Research 5.9 percent. KLA and Qualcomm also gained significantly. Samsung’s competitor Apple was up 2.4 percent.
Among small caps, Gamestop’s shares jumped 15.1 percent after the announcement of a stock split. The video game retailer’s papers belong to the so-called meme stocks, which are hotly debated by private investors on social media and then attract attention with price caprioles.
Shares in retailer Kohl’s turned positive after initial losses. After hitting its lowest level since November 2020, it eventually rose 3.3 percent to $28.26. Bank of America analyst Lorraine Hutchinson downgraded the stock to “underperform” and lowered its price target to $26 from $50. She adjusts her judgment back to her negative assessment of the department store industry. In view of a possible takeover by the Franchise Group, which is now off the table, she had previously rated the stock as “neutral”.
The euro was trading at $1.0159 at the close on Wall Street. It had already fallen below the $1.02 mark in European trading. The European Central Bank set the reference rate at 1.1080 (Wednesday: 1.0177) dollars. The dollar thus cost 0.9823 (0.9826) euros. US Treasury bond prices fell. In the overall somewhat brighter financial market environment, the papers considered safe were hardly in demand. The futures contract for ten-year Treasuries (T-Note Future) recently fell by 0.63 percent to 118.30 points. In return, the yield on ten-year government bonds rose to 3.01 percent./ck/stw
— By Claudia Müller, dpa-AFX —
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