Yesterday the outlook on the New York Stock Exchange was rather sober. On a weekly basis, the Dow Jones fell by almost one percent, but tech stocks were able to recover slightly.
the essentials in brief
- At the start of the US reporting season, the quarterly figures and forecasts of some US financial groups largely caused disappointment yesterday.
The New York leading index Dow Jones Industrial then went into the long weekend with a discount of 0.56 percent to 35,911.81 points – Monday is a holiday in the USA and the stock exchange will remain closed. Technology stocks rebounded in late trade from their sell-off the day before, helping the broader market pare losses. On a weekly basis, the Dow posted a minus of 0.9 percent.
The broader S&P 500 turned positive in late trade yesterday, closing 0.08 percent higher at 4662.85 points. The tech-heavy Nasdaq 100 ultimately gained 0.75 percent to 15,611.59 points. He just managed to get a positive balance of the week. Stocks from the semiconductor industry rose significantly, with Lam Research and Applied Materials each gaining more than six percent.
Overall, the week was characterized by sometimes high price fluctuations. Technology stocks in particular came under considerable pressure at times. They are particularly suffering from fears of interest rates, which increased again after some US monetary authorities signaled that they wanted to fight inflation aggressively.
US economic data gave little cause for celebration yesterday. Sales in the important US retail sector fell much more sharply than expected in December. Industrial production for December also fell short of expectations. The consumer climate survey by the University of Michigan was also disappointing and fell to its lowest level in over ten years in January.
In contrast, the rise in prices for goods imported from the USA weakened more than expected in December. The price data could thus point to some easing of the upward pressure on inflation. On the bond market, however, this did not prevent the yield on ten-year government bonds from climbing back towards 1.8 percent. It was last at 1.788 percent. The futures contract for ten-year Treasuries (T-Note Future) fell by 0.50 percent to 128.08 points.
A few big banks traditionally started publishing company figures for the fourth quarter before the weekend, but the majority of their results did not meet expectations. This included the numbers from JPMorgan. The US money house made less in the fourth quarter than a year earlier, but still more than analysts had expected. However, the trading business went worse than expected by experts.
JPMorgan boss Jamie Dimon also warned of continued inflation risks and prepared investors for significantly rising costs. That was not well received by the market: JPMorgan shares slipped 6.2 percent at the Dow end. With American Express and Goldman Sachs, two other financial stocks in the leading US index were among the biggest losers with price losses of 2.8 and 2.5 percent respectively.
Citigroup’s trading income also fell short of expectations. Chief Financial Officer Mark Mason described the market environment in fixed income trading as challenging. The price minus for Citigroup amounted to 1.3 percent.
The papers of the world’s largest asset manager Blackrock lost 2.2 percent according to quarterly figures. Things went better for Wells Fargo, whose shares rose by 3.7 percent after the quarterly report was presented. Fading concerns about bad loans also gave the bank a jump in profits at the end of 2021.
The euro gave way. The shared currency was trading at $1.1415 after the close. After a week of significant price increases for the euro, traders now spoke of profit-taking. The European Central Bank had set the reference rate at 1.1447 (Thursday: 1.1463) dollars on Friday, the dollar thus cost 0.8736 (0.8724) euros.
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