NEW YORK (awp international) – The US stock market struggled to stay on course for recovery on Tuesday. The most important indices saved themselves after another nervous trading in the plus. Some tailwind for Wall Street came from fresh economic data. US industrial orders rose more than expected in March. Some relief was also provided by the fact that the recent rise in yields in the bond market has paused. Higher interest rates paint stocks in a worse light compared to bonds.
The leading index Dow Jones Industrial rose by 0.20 percent to 33,128.79 points. The market-wide S&P 500 went up 0.48 percent to 4175.48 points. The tech-heavy Nasdaq 100, which fell to its lowest level in more than a year on Monday, rose 0.11 percent to 13,089.90 points.
Market traders justified the nervousness on the market by saying that investors were eagerly awaiting the Fed’s interest rate decision on Wednesday. In view of the high inflation, the key interest rate is expected to be raised by 0.5 percentage points.
The Fed is facing the biggest rate hike since 2000. According to market observers, the central bank’s plans to raise interest rates and reduce its balance sheet will end an era of cheap money. According to the expert Mark Haefele from the bank UBS, investors have to prepare themselves strategically for the high inflation, but not yet for a recession. The expert considers it likely that inflation in the USA has already peaked.
On the company side, the reporting season got under way with Pfizer’s figures, among others. The coronavirus vaccination and the Paxlovid pill against a severe course of the Covid 19 disease had ensured sales and profit figures that exceeded expectations. The shares of the pharmaceutical company rose by around two percent.
The shares of the specialty chemicals group Dupont made up for interim losses in the recently brightened environment and increased by 0.7 percent. High costs for raw materials, among other things, had slowed down operating profit in the first quarter, even if sales increased more significantly.
At the top of the S&P 500, Western Digital’s shares jumped 14.5 percent. Activist investor Elliott Management is pushing for the memory maker to be split up. Western Digital should separate from the business with so-called NAND memories.
Investors were severely disappointed by the cosmetics manufacturer Estee Lauder and above all by the automation group Rockwell, whose prices fell by 5.8 and 14.5 percent, respectively. Burdened by the Ukraine war and renewed corona lockdowns in China, the previous annual targets for both sales and profits had been capped.
The euro last cost 1.0525 US dollars. The European Central Bank had set the reference rate at 1.0556 (Monday 1.0524) dollars. The dollar thus cost 0.9473 (0.9502) euros.
US government bonds rose. The futures contract for ten-year Treasuries (T-Note Future) rose by 0.07 percent to 118.42 points. The yield on ten-year government bonds fell to 2.98 percent./la/he
— By Lutz Alexander, dpa-AFX —
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