The leading index Dow Jones Industrial US2605661048 managed to gain just a little and closed 0.09 percent higher at 42,063.36 points. The broad market S&P 500 US78378X1072, meanwhile, fell 0.19 percent to 5,702.55 points. Both indices recently repeatedly set new records – the Dow even for 4 days in a row.
The technology-heavy Nasdaq 100 US6311011026 lost 0.24 percent to 19,791.48 points on Friday. It is still lagging slightly behind its record from July. For the week, the Dow and Nasdaq 100 posted price gains of 1.6 and 1.4 percent respectively.
Despite the current optimism in the markets, it should be remembered that bets on future price developments continue to price in a more aggressive pace of interest rate cuts than indicated by the Fed on Wednesday, warned strategist Jim Reid of Deutsche Bank.
Other experts, however, were more optimistic. Although greed is gradually increasing in highly watched market segments, so that overheating is slowly threatening, commented the experts at Index Radar. In principle, however, the latest price breakout confirms the trend and should therefore be viewed positively. The S&P 500 in particular could now have “resolved a very promising upward price pattern”.
The experts at the Swiss bank UBS also see further price potential: “In the past, stocks have performed well in times of interest rate cuts by the Fed, when the US economy continued to grow at the same time.” The markets have apparently priced in this scenario – a clear turnaround after the economic concerns at the beginning of August. At that time, weak US job data had raised fears that the Fed might have waited too long to raise interest rates.
Fedex dampened sentiment before the weekend. After a disappointing quarter, DHL competitor DE0005552004 lowered both its sales and profit forecasts for the current financial year. Fedex was particularly affected by a decline in demand for express services in the USA. The shares, which had recently performed strongly, fell by around 15 percent. Shares in domestic rival UPS US9113121068 fell by 2.7 percent.
Despite a surprisingly good profit trend, shares in the construction company Lennar lost 5.3 percent in the last quarter. Apparently, many investors cashed in on the price gains after the recent record-breaking campaign.
Trump Media & Technology continued its downward trend with a share price drop of 7.8 percent. After a holding period for majority shareholder Donald Trump expired, the other shareholders apparently did not want to take any risks. The fact that the former US president, who is running for a second term, recently denied several intentions to sell did not help the shares.
In contrast, shares of Dow leader Nike US6541061031 jumped by 6.8 percent. The sporting goods giant is changing its boss. Company veteran Elliott Hill is returning to Nike and is set to take over the leadership in mid-October. Confidence in a turnaround with renewed sustainable growth will increase with Hill’s appointment, wrote Krisztina Katai of Deutsche Bank. UBS analyst Jay Sole, however, warned that the short-term positive momentum may not last. There is no quick solution to the not so good fundamental situation.
Intel shares US4581401001 rose by up to almost 10 percent thanks to vague takeover fantasies, but only managed to reach the finish line with a price increase of just over three percent. The Wall Street Journal reported, citing informed sources, that industry colleague Qualcomm had approached the semiconductor company in recent days with a takeover offer. According to the newspaper, Qualcomm is fundamentally interested, but a possible bid is still a long way off. Qualcomm fell by almost 3 percent.
The euro EU0009652759 moved little and most recently cost 1.1157 US dollars. The European Central Bank had previously set the reference rate at 1.1166 (Thursday: 1.1156) dollars, meaning the dollar cost 0.8955 (0.8963) euros. US government bonds rose moderately: the futures contract for ten-year paper (T-Note Future) rose by 0.03 percent to 114.77 points. The yield on bonds with this maturity was 3.74 percent./gl/zb
