NEW YORK (dpa-AFX) – Rising interest rates on the US bond market and surprisingly weak data from the domestic labor market hit the US stock exchanges on Wednesday. Even the best-known Wall Street index, the Dow Jones Industrial, was no longer able to maintain positive growth at the end of the trading day and ultimately fell 0.39 percent to 31,270.09 points.
The market-wide S&P 500 fell by 1.31 percent to 3819.72 points and the Nasdaq 100 even dropped by 2.88 percent to 12,683.33 points. By contrast, US government bond yields rose again significantly. The futures contract for ten-year government bonds (T-Note-Future) fell by a significant 0.45 percent to 133.10 points. The return rose to 1.47 percent. In the past week, however, it had increased even more and reached a one-year high of around 1.55 percent.
The impression that the ups and downs in capital market rates could continue has been reinforced by this current development. Rising growth and inflation expectations in the USA are considered to be the trigger. Equity investors are increasingly concerned that as interest rates rise, bonds are once again becoming more attractive as an investment alternative. Refinancing can also become more expensive for companies.
There was also negative news for the stock market with regard to employment in the US private sector. According to the labor market service provider ADP, employment rose significantly less than expected in February. Now there is concern that this could be a negative omen for the US government’s official labor market report due on Friday.
These two negative developments stand in the way of the economic optimism that is emanating from the rapidly advancing vaccination campaign in the USA. According to President Joe Biden, enough vaccine will be available for all adults “by the end of May”, after a time frame of up to the end of July had been targeted. The Fed also said in the economic report that the economy was optimistic in view of the vaccination campaign. Until mid-February, however, the US economy grew only moderately.
Among the individual stocks in the Dow, the technology stocks, which have so far been particularly strong, were the worst performers. The shares of Apple, Microsoft and Salesforce lost between 2.5 and 3.5 percent. Intel gave way by 2.2 percent. The chip company was defeated in a patent dispute and immediately announced that it would appeal. According to a ruling on Tuesday, Intel was sentenced by a jury to pay nearly $ 2.2 billion for alleged infringement of two patents covering technologies used in semiconductor manufacturing in Texas.
Shares in oil companies such as Chevron, ConocoPhillips and ExxonMobil benefited from the further sharp rise in crude oil prices. Chevron were among the favorites in the Dow with a plus of 1.1 percent and ConocoPhillips gained 2.6 percent in the S&P 100. The shares of ExxonMobil, which had invited to the capital market day this Wednesday, rose by only 0.8 percent.
The papers of the online mortgage company Rocket Companies collapsed by around a third on the Nyse, which had shot up by a little more than 70 percent the day before. Parallels have been drawn on the market with the latest Gamestop hype and crash, since Rocket shares, like GameStop, are among those stocks that are generally sold short. Hedge funds in particular are actively involved in short sales and sell stocks without owning them. They speculate on being able to buy them back cheaper at a later date.
At Rocket, like last time with GameStop shares, this bet doesn’t seem to have paid off. The share began to rise at the end of February after quarterly figures that were better than expected. Then on Tuesday they suddenly and unexpectedly shot up. It is therefore suspected that a group of private investors, the so-called WallStreetBets movement, could now have pounced on Rocket. At the very least, many short sellers are likely to have been forced to stock up on the paper the day before, despite rising prices, in order to avoid even greater losses.
The euro was priced at $ 1.2065 at Wall Street close. In the morning in Frankfurt trade, the euro had risen to $ 1.2113. The European Central Bank set the reference rate at 1.2048 (Tuesday: 1.2028) dollars. The dollar thus cost 0.8300 (0.8314) euros./ck/men
By Claudia Müller, dpa-AFX
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