Statements by the Fed last week were seen as evidence that interest rates in the USA were only being raised gradually. Broker Oanda’s Jeffrey Halley spoke of market sentiment swinging, with bargain hunters increasingly desperate to find a cyclical bottom.
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The Fed has already hiked interest rates twice this year. This Wednesday it will also begin to melt its balance sheet, which was inflated by the purchase of securities, which were carried out to support the economy during the pandemic.
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However, the strategists at Citigroup are now assuming that the headwind on the stock markets will not be over after the first difficult five months. They see the risk of falling profit forecasts by companies as a further problem for unsettled investors.
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Company news received mixed reviews midweek. The software group Salesforce thrilled with a higher profit forecast. The fact that the SAP competitor is now promising lower annual sales did not bother investors, as the price jump of almost 13 percent showed.
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At the computer manufacturer HP Inc Inc, the shareholders were happy about a price increase of around two percent after the quarterly figures.
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Meanwhile, the airline Delta Air Lines expects sales in the second quarter to be at the level before the corona pandemic. The shares fluctuated violently – most recently they lost over four percent.
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Shares of S&P Global lost almost three percent. The financial services group has put its financial forecast on hold due to deteriorating macroeconomic conditions – new targets are not expected to be announced until the second quarter figures. The disappointed investors also punished competitor Moody’s with a price drop of almost four percent.
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