NEW YORK (awp international) – The recently stabilized US technology stocks came under pressure again on Monday. Market participants once again referred to the fears of interest rates, inflation and recession, which are now part of everyday stock market life and which particularly affected the strongly growth-oriented tech stocks. Ahead of more important economic news this week and the beginning of the US corporate accounting season, these worries have investors a bit more in their grip.
In addition, the focus on China dampened investors’ appetite for risk. The number of new infections there reached its highest level since the end of May. Authorities say the risk is very high, which fueled further market concerns as Beijing remains committed to its zero-Covid strategy. Against this background, investors fear new supply bottlenecks if the government should impose lockdowns again to contain the virus.
The tech-heavy Nasdaq 100 was down 1.53 percent to 11,940.27 points. The market-wide S&P 500 fell 0.73 percent to 3870.92 points. The leading US index Dow Jones Industrial briefly made it into the profit zone, but recently fell by 0.13 percent to 31,296.93 points.
In the past week, the most important US indices had recovered a bit. However, with the robust US jobs report presented on Friday, the momentum of stabilization has already ebbed away – because many stock market traders see this as confirming the expectation that the gates are wide open for a further significant tightening of US monetary policy. However, this also gives rise to fears that the monetary watchdogs may overshoot the target and thus damage the economy, and that equities will become less attractive compared to other asset classes.
“After the strong labor market figures, higher-than-expected consumer price inflation would increase the pressure on the US central bankers to continue to counteract the price pressure with extensive interest rate hikes,” conclude the experts at Postbank with a view to the inflation data due in the course of the week.
In terms of individual values, Twitter stocks were once again in the spotlight after billionaire and Tesla boss Elon Musk did not want to buy the short message service after all. Musk’s lawyers justified the withdrawal with allegedly insufficient information on the number of fake accounts. The company wants to push through the deal in court, and the shares recently dropped by around nine percent.
Tesla’s stocks were unable to benefit from the news, although they had recently suffered from the prospect that Musk would have to sell his own shares in the electric car maker to finance the Twitter deal. Instead, Tesla’s shares lost almost six percent. They were weighed down by the threat of recession and renewed production disruption in China.
Uber’s shares fell by a good four percent. Internal documents from the transport service broker from the years 2013 to 2017 that have now come to light gave deeper insights into the aggressive business practices of the company at the time./la/he
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