NEW YORK (dpa-AFX) – Wall Street sagged significantly again on Thursday. After the price rises in the middle of the week, the cyclically sensitive technology stocks in particular had to accept massive losses. The reason for this was the continued rise in yields on the bond markets, which in turn is related to the fear of rising inflation. The interest rate for ten-year US government bonds climbed over 1.5 percent, the highest level since February 2020.
The US leading index Dow Jones Industrial lost 1.32 percent to 31,539.45 points after climbing over 32,000 points for the first time on Wednesday. The market-wide S&P 500 fell 1.92 percent to 3850.12 points and the technology-heavy Nasdaq 100 dropped 2.83 percent to 12 925.25 points.
Investors are more and more convinced that inflation will increase and cause the central bank to tighten its monetary policy, commented analyst Craig Erlam of the trading house Oanda Europe. However, higher interest rates make stocks look worse than fixed-income securities. Technology stocks suffer particularly from the rise in yields, as this increases their financing costs. In addition, they had risen above average in the past few months, now investors continued to cash in.
Among the biggest losers in the sector, Nvidia’s shares slipped by more than eight percent. A high demand for technology for data centers and graphics cards caused the chip manufacturer’s sales and profits to jump further in the past quarter. During the conference call on the business figures, however, CFO Colette Kress said that the growth is currently the result of the computer games business. Some analysts therefore feared that this could mean that the data center division is expanding a little more slowly.
The Telekom subsidiary T-Mobile US secured 142 licenses for 9.3 billion US dollars at a frequency auction in the USA with a view to the planned network expansion of the new 5G mobile communications standard. Compared to its competitors, T-Mobile US did not have to dig deep into its pockets. One of the reasons for this is that T-Mobile US’s frequency configuration was already considered good. The shares of the Telekom subsidiary gained 1.6 percent, while AT&T and Verizon lost 2.5 and 1.4 percent respectively.
The shares of Twitter soared to a record high and were recently a good six percent plus. The short message service aims to double its annual turnover by the end of 2023.
The vaccine manufacturer Moderna kept high research and development costs in the red at the end of 2020, but the strong demand for the corona vaccine caused sales to explode. The papers rose by 4.5 percent.
Among the weakest values in the S&P 500, the shares of Best Buy buckled by almost ten percent. The electronics retailer disappointed with its business forecast for this year.
In addition, the excitement about the video game retailer Gamestop never ends. After the shares were temporarily suspended from trading on Wednesday and closed with a plus of 104 percent, it now went up another 87 percent. The vice chairman of Warren Buffett’s investment company Berkshire Hathaway, Charlie Munger, sees the price volatility with great concern. They are signs of an “irritating bubble” that has to come to a bad end at some point. / La / he
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