–
–
Virginie MONTET
France Media Agency
According to final results at the close, the Dow Jones index lost 2.03%, dropping below the 30,000 point mark to 29,982.62 points. The tech-heavy NASDAQ dropped 2.00% to 13,070.69 points and the S&P 500 dropped 1.93% to 3,714.24 points.
Over the week, the three indices posted losses of -3.27% for the Dow Jones, -3.48% for the NASDAQ and -3.31% for the S&P.
In Toronto, the S & P / TSX Composite Index of Toronto Flooring lost 320.18 points, or 1.8%, to end the day with 17,337.02 points.
In the currency market, the Canadian dollar traded at an average rate of 78.25 cents US, up from its average rate of 78.06 cents the previous day.
On the New York Commodities Exchange, the price of crude oil fell 14 cents US to US $ 52.20 per barrel, while that of gold rose US $ 9.10 to $ 1,850.30 US per ounce. The price of copper fell 2.2 cents US to end the day near US $ 3.56 a pound.
Hedge funds in trouble
“We are witnessing a great reduction in risk. These investment funds are facing billions of dollars in losses and to cover these losses they have had to sell stocks where they had profits and long positions, ”explained Karl Haeling of LBBW who says there had “a general directive” among “hedge funds” to reduce their positions.
“It’s all about Robinhood, GameStop, etc. How are funds going to fare now without creating losses when they still have a lot of short positions in other stocks? “Asked the analyst.
Stock marketers, meeting in particular on a forum on the Reddit site, have launched for a week a fierce battle with large investment funds having bet down on inefficient companies such as the video game store chain GameStop or that of AMC movie theaters, by practicing short selling.
US online brokers, like Robinhood and TD Ameritrade, have had to limit trading in these securities since Thursday to stem the rout. These transaction restrictions have angered small holders while the policeman of the Stock Exchange – the SEC – justice in some cases such as Texas, and even Congress will look into these measures.
GameStop and AMC are still climbing
Some limitations imposed by brokerage platforms remained in place on Friday, but trading had resumed as a whole.
GameStop thus continued to climb (+ 70% at the close) to 328.24 dollars on Friday as did AMC (+ 54%).
At the same time, the eleven sectors of the S&P 500 all finished in the red, with energy (-3.39%) and information technology (-2.40%) leading the process.
The usual tech headliners have declined, from Tesla (-5.02%) to Apple (-3.74%) via Facebook (-2.52%) and Microsoft (-2.92%) .
For Art Hogan of National Securities, other factors were playing down, including the skepticism of some key elected officials in Congress over President Joe Biden’s massive $ 1.9 billion support plan.
The results season has also continued to be in full swing, with mixed results for Caterpillar (-0.81%) and Chevron (-4.27%) which are suffering from the crisis and for Colgate (-1.45%) who did better.
The US government has also published the figure for inflation which accelerated more than expected in December to + 0.4%, even if it is moderate over one year to 1.3%.
Among the good news, the incomes of American households rose in December for the first time since September, in part thanks to the 900 billion dollars aid plan adopted at the end of the year by Congress.
But their spending fell 0.2%. And consumer confidence, which deteriorated in January, according to the University of Michigan barometer, is not likely to support consumption.
On the vaccine front, investors have not welcomed the results of the trials of the COVID-19 vaccine by the American group Johnson and Johnson (-3.56%), with an overall effectiveness of 66% and even less good against the South African variant virus.
– With The Canadian Press
–
