ROUNDUP/New York stocks: Losses – prospect of tighter monetary policy | 05.04.22

NEW YORK (dpa-AFX) – In anticipation of further western sanctions against Russia, the US stock markets have shifted down a gear again. After the gains at the beginning of the week, technology stocks, which are sensitive to the economy, came under pressure on Tuesday, while the standard indices moved only slightly.

Statements by the deputy chairman of the US Federal Reserve, Lael Brainard, on monetary policy also proved to be a burden. According to a previously distributed speech, Brainard said that the Fed would reduce its total assets at a rapid pace starting in May. With this step, liquidity would be withdrawn from the stock exchanges. Such tighter monetary policy can be detrimental to stock markets as other asset classes become more attractive. The Fed had already raised the key interest rate in mid-March for the first time since the Corona crisis. The background is the high inflation, which is fueled by rising raw material costs.

The leading index Dow Jones Industrial (Dow Jones 30 Industrial) was recently listed slightly up at 34,952.12 points. However, the broader S&P 500 fell 0.28 percent to 4569.68 points and the tech-heavy NASDAQ 100 was down 1.21 percent to 14,976.79 points.

After the atrocities in the Ukrainian city of Bucha, the European Union (EU) is working on new sanctions against Russia – an energy embargo could be imposed for the first time: coal imports from Russia to the EU are to be stopped. It was initially unclear when the ban could apply.

The online giant Amazon has secured places in dozens of rocket launches for its planned satellite network with fast Internet access. Contracts with, among others, the European provider Arianespace and the space company Blue Origin involve up to 83 starts. The network, called Kuiper, is said to have 3,236 satellites. Amazon competes with the Starlink network of the company SpaceX from tech billionaire Elon Musk. The Amazon papers lost around two percent.

In contrast, Twitter shares (Twitter) continued their rally at the beginning of the week and rose by a good three percent. Tech billionaire Elon Musk is also moving into the company’s board of directors after his surprising entry into the short message service. Musk officially gets more influence on Twitter’s strategy. The boss of the electric car manufacturer Telsa (Tesla) believes in the platform and is also a sharp critic, wrote Twitter boss Parag Agrawal. “This is exactly what we need” for Twitter to become stronger in the long run.

The day before, the company had announced that the Tesla founder would become the largest Twitter shareholder with 9.2 percent. The Twitter papers had responded with a price jump of 27 percent.

General Motors shares fell by more than three percent in the clouded environment. The car company wants to expand its partnership with the Japanese carmaker Honda (Honda Motor) in the field of electromobility. They want to bring “a range of affordable electric cars” onto the market from 2027. They want to focus on the “compact crossovers” segment, i.e. compact cars with an SUV look./la/he

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