NEW YORK (awp international) – The US stock market fell moderately on Monday in generally quite calm trading. However, there was no clear direction during the course of the day. Investors analyzed the mixed ISM sentiment data from US industry on the one hand and new statements from central bankers on the other.
After some back and forth, the Dow Jones Industrial lost 0.14 percent to 32,798.40 points. The market-wide S&P 500 slipped 0.28 percent to 4118.63 points. The Nasdaq 100, which is predominantly stocked with technology stocks, fell 0.06 percent to 12,940.78 points. However, July was unusually strong for the stock exchanges: the Dow had recovered by around seven percent in the past month and the Nasdaq 100 by almost 13 percent.
On this day, the focus was primarily on ISM data: As the Institute for Supply Management (ISM) announced shortly after the start of trading, sentiment in US industry fell to 52.8 points in July, its lowest level in more than two years. However, economists had expected an even more pronounced drop to just 52.0 points. “The Purchasing Managers’ Index has exceeded the consensus estimate and is also still clearly in the expansion zone,” emphasized Helaba’s economist Ulrich Wortberg positively. “Against this background, doubts about growth should not increase and the US Federal Reserve can stick to its plan to initially raise interest rates further to curb inflation.”
However, hopes of a possible gradual turnaround in US Federal Reserve monetary policy, which had burgeoned after the recent interest rate hike, faded. Because central bankers have now indicated that interest rates will have to be raised further in order to bring inflation under control. The sub-indicator of the ISM for incoming orders, which had been particularly weak, is now signaling a contraction.
Among the individual stocks in the Dow, shares in aircraft manufacturer Boeing jumped 6.1 percent. According to circles, the group is about to resume deliveries of the long-haul jet 787 (Dreamliner). The group has received preliminary approval from the US Federal Aviation Administration, the Bloomberg news agency reported, citing people familiar with the matter. According to RBC analyst Ken Herbert, this is good news not only for Boeing stock but for the sector as a whole. Goldman analyst Noah Poponak expects this will now unlock significant cash inflows and ease concerns about the capital structure.
Alibaba gained 1.1 percent after a significant slide in prices on Thursday and Friday. The Chinese Amazon competitor announced that it wants to work with the US authorities to keep the previous listing on the New York Stock Exchange in addition to the new listing in Hong Kong. On Friday, the US Securities and Exchange Commission (SEC) put Alibaba on a list of companies threatened with delisting.
Celsius shares rose 11.1 percent to $98.87. Pepsico gained 1.1 percent. The soft drink company and Coca-Cola competitor secured an 8.5 percent stake in the fitness and energy drink maker for $550 million, or $75 a share.
Twitter titles fell 1.7 percent. Tech billionaire Elon Musk filed a response to the short message service’s lawsuit in the legal battle over his withdrawn takeover bid. However, the document from Friday is not publicly available for the time being. Musk’s lawyers have a few days under court rules to release a version without confidential details.
The euro was trading at $1.0258 at the close on Wall Street. The European Central Bank set the reference rate in Frankfurt at 1.0233 (Friday: 1.0198) dollars. The dollar thus cost 0.9772 (0.9806) euros.
On the US bond market, the futures contract for ten-year Treasuries (T-Note Future) rose by 0.26 percent to 121.45 points. At the same time, the yield on ten-year government bonds fell to 2.59 percent./ck/he
— By Claudia Müller, dpa-AFX —
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