© Reuters. What are the most important factors that affected the performance of US stocks this week?
Arabictrader.com – The US stock market witnessed very volatile trading this week, which resulted in the S&P 500 and Nasdaq incurring strong weekly losses estimated at 0.3% and 1.9%, respectively, which is the first time in 2023 that it has declined for two consecutive weeks, while the index ended This week it is up 0.6%.
In terms of closing today’s trading, the S&P 500 index closed trading down by 0.11%, to settle at 4464.6 points. Nasdaq also declined with the closing of US stock trading, recording 15028.6 points, while it closed today’s trading with a rise of 0.30%, recording 35281.41 points.
In the following lines, the most important factors that affected the performance of US stocks this week can be addressed:
With the opening of the first trading this week, investors faced some developments that revived concerns about the US banking sector, foremost of which was Moody’s downgrading the credit ratings of many small and medium-sized American banks in the United States, warning of the possibility that the rating of some of the largest lenders would be downgraded in the future; This was in the wake of Fitch’s downgrade of the US credit rating.
This step raised market concerns about the stability of the banking sector in the world’s largest economic power, especially since fears of a US recession in early 2024 as a result of tightening monetary policy of the US Federal Reserve looms on the horizon, and this in turn reflected negatively on US stock indices in the first trading this week.
However, the performance of US stocks quickly recovered to some extent, with the comments of the Managing Director of Financial Institutions at Moody’s, which stated that the US banking system is still strong, as the recent measure does not mean that the banking system is facing strong stumbling blocks; This boosted the performance of US stocks at the time.
The bill signed by US President Joe Biden on Wednesday added selling pressure during subsequent US stock trading, and the bill allows the US Treasury Department to ban or restrict certain US investments in Chinese entities and companies, in the three main technology sectors: semiconductors, microelectronics and technology. Quantitative information and some specific systems in the field of artificial intelligence, which may negatively affect the profitability of companies operating in the technology sectors, which ultimately affected the performance of US stocks.
Moreover, some US data issued at the end of the week reinforced the bearish momentum of US stock indices, as the data revealed that the US producer price index increased by 0.3% in July, compared to the previous reading of 0.2% in June, with the rise in production costs, which led to higher bets. Markets are concerned about the US Federal Reserve raising interest rates by 25 basis points at the next September meeting, which led to a recovery in demand for US bonds – which is one of the less risky investment tools compared to stocks – and then a decline in US stocks.
2023-08-13 12:08:00
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