On Tuesday, the New York stock market posted notable gains thanks to significant gains by US technology giants. The Dow Jones Industrial, which is mainly made up of standard stocks, was only able to benefit marginally from this momentum and only recorded an increase of 0.30 percent, which took it to a level of 42,080.37 points.
The S&P 500 fared better, gaining 0.97 percent to 5,751.13 points, and especially the technology-oriented Nasdaq 100, which gained an impressive 1.55 percent to 20,107.78 points. In particular, the so-called “Magnificent Seven” – Nvidia, Apple, Tesla, Meta, Microsoft, Amazon and Alphabet – proved to be price drivers and recorded price gains of between 0.8 and 4.1 percent.
Ongoing market volatility continued amid these gains. Market participants reported increased short covering ahead of the release of the Fed minutes. This involves purchasing previously borrowed shares in order to minimize losses, which in turn can drive up prices further.
Following positive labor market data, there is currently great uncertainty in the market. The prospect of a “soft landing” for the US economy was boosted by these numbers, but a 0.5 percentage point interest rate cut by the Fed appears to be off the table. An adjustment of 0.25 points is currently expected, while maintaining the current interest rate level also seems possible.
The focus now turns to the Fed minutes and the upcoming inflation and producer price data, which could have a decisive influence on the Fed’s monetary policy. The quarterly reporting season, which is about to start, should provide insight into how companies are faring in the current economic environment.
Pepsico impressed with a solid interim report, which gave shares in the S&P 100 an increase of 1.9 percent, despite product recalls. Honeywell rose 1.8 percent in the Dow after announcing plans to focus its business. Chinese companies such as Alibaba and Baidu recorded a decline of around 7 percent as uncertainties remained regarding the announced economic measures in China.
WW International surprised with a nearly 50 percent jump in share price, even though the company’s performance since the beginning of the year has been weak. A new weight loss product is intended to put pressure on the currently dominant drugs Ozempic and Wegovy in the future.
The euro was stable, last trading at $1.0979, while the U.S. bond market saw moderate moves, with the 10-year U.S. Treasury futures contract rising slightly by 0.07 percent.
