NEW YORK (Dow Jones) — After two days of losses, the US stock market closed with significant increases on Thursday and recovered from initial losses. Trading continued to be characterized by a very volatile environment. The Dow Jones index closed 1.3 percent higher at 33,249 points, and the S&P 500 was 1.8 percent higher. The tech-heavy Nasdaq Composite gained 2.7 percent. There were a total of 2,466 (Wednesday: 1,341) price winners and 806 (1,972) losers. 117 (140) titles closed unchanged.
Good US economic data had recently reinforced fears that the US Federal Reserve would stick to its tight monetary policy in order to curb high inflation. In addition, the Federal Reserve officially began shrinking its nearly $9 trillion balance sheet on Wednesday.
US Federal Reserve Deputy Chairwoman Lael Brainard expects the central bank to hike interest rates by half a percentage point at its meeting later this month and again in July. However, it is still too early to say whether the Fed will slow down the pace of interest rate hikes afterwards, said the central banker. Brainard said it was premature to state that inflation had peaked.
On the economic side, the ADP employment report for the private sector for May fell short of expectations. Only 128,000 new jobs were created here, while the estimate was 299,000. It is used as an indicator for the official US job market report on Friday. This should show that the job engine in the USA is still running at full speed. Weekly initial claims were broadly in line with expectations.
New orders in US industry rose less in April than economists had expected. Meanwhile, non-farm productivity for the first quarter was slightly better than expected on the second reading compared to the previous quarter.
Oil prices rise – dollar weakens
Prices rose on the oil market, but were volatile. The price of a barrel of the WTI variety increased by 1.8 percent, the Brent price was 1.4 percent higher. The oil cartel Opec and its allies have agreed on a subsidy increase. Opec officials said the group plans to expand production in July and August by 648,000 barrels a day, faster than expected. According to one observer, however, there is an expectation on the market that demand will continue to exceed supply despite the increased production. US crude inventories, meanwhile, have fallen more than forecast. They fell 5.068 million barrels from the previous week, according to the state’s Energy Information Administration (EIA).
The dollar gave back much of the previous day’s gains. The dollar index fell 0.7 percent. Dollar selling spurts on signs of a slowing US economy or speculation of a slowdown in US Federal Reserve rate hikes should be short-lived given the currency’s “safe-haven qualities,” said Jane Foley, head of FX strategy Rabobank. Although Rabobank expects the US economy to slide into recession next year, the dollar should continue to find support.
Yields on the bond market increased slightly after the recent significant rises. The 10-year yield was up 0.4 basis points at 2.92 percent.
The price of a troy ounce of gold benefited from the weaker dollar and rose by 1.3 percent.
Hewlett-Packard under sales pressure
Microsoft gained 0.8 percent, recovering from initial losses. The group lowered its sales and earnings guidance for the fourth quarter, citing unfavorable exchange rates as the stronger US dollar took its toll. The company now expects revenue of $51.94 billion to $52.74 billion, versus $52.4 billion to $53.2 billion previously. Earnings are expected to be between $2.24 and $2.32 per share versus the previous guidance of $2.28 to $2.35 per share.
Hewlett Packard Enterprise shares lost 5.2 percent. The company has lowered its full-year guidance due to the impact of supply shortages, negative currency effects and the pullout from Russia.
Gamestop increased by 10.4 percent. The retail chain for entertainment software reported a higher loss than the market had expected, but sales were a tad higher than forecast.
===
INDEX last +/-% absolute +/-% YTD
DJIA 33,248.61 +1.3% 435.38 -8.5%
S&P 500 4,176.88 +1.8% 75.65 -12.4%
Nasdaq Comp. 12,316.90 +2.7% 322.44 -21.3%
Nasdaq-100 12,892.89 +2.7% 344.52 -21.0%
US Bonds
Term Yield Bp to VT Yield VT +/-Bp YTD
2 years 2.64 -1.6 2.66 191.2
5 years 2.92 +0.2 2.92 166.0
7 years 2.95 +0.2 2.95 151.4
10 years 2.92 +0.4 2.91 140.6
30 years 3.07 +1.3 3.06 117.5
FOREX last +/- % Thu 8:20 Wed 17:06 % YTD
EUR/USD 1.0749 +0.9% 1.0662 1.0655 -5.5%
EUR/JPY 139.58 +0.7% 138.57 138.52 +6.7%
EUR/CHF 1.0295 +0.3% 1.0268 1.0281 -0.8%
EUR/GBP 0.8548 +0.2% 0.8536 0.8533 +1.7%
USD/JPY 129.85 -0.2% 129.96 129.97 +12.8%
GBP/USD 1.2575 +0.7% 1.2490 1.2487 -7.1%
USD/CNH (Offshore) 6.6591 -0.6% 6.6989 6.6922 +4.8%
Bitcoin
BTC/USD 30,282.58 +2.5% 29,811.97 31,168.82 -34.5%
ROHOEL last VT-Settl. +/- % +/- USD
WTI/Nymex 117.34 115.26 +1.8% 2.08
Brent/ICE 117.95 116.29 +1.4% 1.66
METALS last day before +/- % +/- USD % YTD
Gold (Spot) 1,869.95 1,846.50 +1.3% +23.45 +2.2%
Silver (Spot) 22.32 21.83 +2.2% +0.49 -4.3%
Platinum (Spot) 1,026.75 998.50 +2.8% +28.25 +5.8%
Copper Future 4.55 4.33 +5.0% +0.22 +2.1%
===
Contact the author: [email protected]
DJG/err
(END) Dow Jones Newswires
June 02, 2022 16:16 ET (20:16 GMT)
Leverage must be between 2 and 20
No data