NEW YORK (dpa-AFX) – After the strong previous day, Wall Street also posted price gains on Wednesday. Two and a half hours before the market closed, the Dow Jones Industrial (Dow Jones 30 Industrial) gained another 0.94 percent to 35,238 points. The leading index is thus close to its interim high from the end of March, above which it would be the highest level in more than two months. The jump the day before above the high-volume area of 34,800 points is a sign of strength, said the charting experts at Index Radar.
However, Netflix sent bad news – and thus clouded the mood, especially in the technology sector. With a fall in customer numbers for the first time in more than ten years in the past quarter, the streaming service shocked investors again after the disappointing outlook at the end of January. Netflix shares recently lost more than 35 percent.
In the market-wide S&P 500 and above all in the technology-heavy NASDAQ 100, where the Netflix shares are listed, the development was more restrained compared to the Dow index. The S&P 500 recently advanced by 0.29 percent to 4475 points, the Nasdaq 100 fell by 0.97 percent to 14,072 points after its very strong previous day.
Data came out of the US housing market again on Wednesday, where existing home sales fell 2.7 percent in March. The development was not quite as bad as analysts had expected. “The real estate market is beginning to feel the effects of soaring mortgage rates and higher inflation, which are affecting purchasing power,” said Lawrence Yun, chief economist for the National Association of Realtors (NAR). Nevertheless, houses would be sold quickly and house prices rose significantly. The day before, the real estate market had surprised positively with an increase in the number of newly started houses and building permits.
In the further course, the economic report of the US Federal Reserve comes into view. It could provide clues as to how well the US economy is coping with rising interest rates. The Fed has already raised interest rates to combat high inflation and has signaled further steps. In the middle of the week, the yield on ten-year government bonds was at 2.8 percent, some way from the highest level reached the previous day since the end of 2018.
In view of the disappointing development in the past quarter, Netflix now wants to crack down on users who share their access data and is working on a cheaper version with advertising. However, the authors of the current Bernecker shareholders’ letter believe that the group should already have passed the peak of its success. The competition is catching up and it is becoming increasingly difficult for Netflix to build on past successes. The capital requirement is correspondingly high.
The Netflix disappointment also put other stocks in the industry under pressure midweek. The papers of the entertainment giant Walt Disney, which has its own streaming offers, lost a good four percent. Titles from the audio streaming service Spotify fell almost 10 percent and those from the streaming device provider Roku lost 3.5 percent.
The computer group IBM, on the other hand, exceeded expectations in the past three months, which caused the shares at the top of the Dow to rise by 7.5 percent. The group benefited from growth in the software and consulting business. According to the analysts at DZ Bank, the spin-off of the more traditional IT service business is paying off more and more for IBM.
Procter & Gamble (P&G) (ProcterGamble) shares were up 2.5 percent. The consumer goods group scored with strong quarterly figures and once again raised its target for organic sales growth in the current financial year./ajx/he
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