NEW YORK (Dow Jones) — US stock markets ended weaker on Wednesday. At the end of a volatile session, stagflation fears took over.
The Dow Jones index lost 0.8 percent. The S&P 500 was down 1.1 percent. The Nasdaq Composite fell 0.7 percent. The 836 (Tuesday: 2,270) price winners faced 2,376 (1,029) losers. 108 (147) titles closed unchanged.
The economic pessimists received new arguments from the Organization for Economic Co-operation and Development (OECD) and from the World Bank. Because both had lowered their global growth forecasts significantly. The OECD therefore advises the central banks to take a differentiated approach in the fight against high inflation. However, the organization expressly excludes the USA from this and advises the US Federal Reserve to take vigorous action.
This is exactly where investors saw the stagflation concerns again. These were reinforced by US Treasury Secretary Janet Yellen. During an appearance in front of MPs the day before, she had warned that US inflation could remain at the elevated level for a while. Against this backdrop, investors feared Friday’s May CPI release. Concerns about inflation were also fueled by the oil price, which rose above the $120 a barrel mark to its highest level in three months
“We’re in a holding pattern right now. Investors won’t take too many risks until we get a clearer picture that inflation is slowing down,” said market strategist Brian O’Reilly of Mediolanum International Funds.
Novavax sought with prospect of vaccine approval
Among individual stocks, shares of Novavax gained 5.4 percent. A panel of experts from the US health authority FDA has recommended the company’s corona vaccine – although the authority had seen a “cause for concern” in a preliminary analysis because of a possible risk of heart muscle inflammation. Now an emergency approval could be issued shortly. Analysts’ concerns that the Novavax vaccine would be late and that the company could not gain much market share were allayed.
Shopify stock is up 2.8 percent. The provider of e-commerce software carries out a stock split at a ratio of 1 for 10. Western Digital fell 4.1 percent. The specialist for storage solutions has agreed with the activist investor Elliott Management to split up the business areas. Campbell Soup gained 1.5 percent after the food maker reported rising sales. The company also raised its outlook. Smartsheet fell by around 7 percent, the software provider wrote higher losses. State Street fell 5.4 percent on speculation the bank could bid on Switzerland’s Credit Suisse.
Prices on the bond market fell, and yields recovered from their previous day’s losses. The yield on ten-year US government bonds was again above the 3 percent mark. The statements by the OECD and Yellen fueled interest rate hike speculation, it said. The dollar was also somewhat supported by speculation and rising market interest rates, the dollar index was somewhat firmer, but below its daily high. The euro in particular rose, market observers did not want to completely rule out a hawkish surprise for the interest rate meeting of the ECB on Thursday.
Gold found some buyers despite higher bond yields and a slightly firmer dollar. Observers referred to the US consumer price data due out on Friday, which could fuel inflation and economic concerns.
Oil prices rose significantly, despite the surprising rise in US oil stocks. With regard to Russia and Iran, the players are counting on a continued tight supply. Iranian oil is hardly to be expected in the medium term, since the mullahs’ regime is apparently continuing to work on the development of a nuclear bomb, according to reports, according to the trade. In this respect, sanctions are unlikely to be lifted.
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INDEX last +/-% absolute +/-% YTD
DJIA 32,910.90 -0.8% -269.24 -9.4%
S&P 500 4,115.77 -1.1% -44.91 -13.7%
Nasdaq Comp. 12,086.27 -0.7% -88.96 -22.8%
Nasdaq-100 12,615.13 -0.8% -96.55 -22.7%
US Bonds
Term Yield Bp to VT Yield VT +/-Bp YTD
2 years 2.78 +4.5 2.74 205.2
5 years 3.05 +6.0 2.99 178.8
7 years 3.07 +4.8 3.02 162.7
10 years 3.03 +4.9 2.98 152.0
30 years 3.19 +5.8 3.13 129.0
FOREX last +/- % Tue, 9:44 Tue, 17:35 % YTD
EUR/USD 1.0714 +0.1% 1.0691 1.0692 -5.8%
EUR/JPY 143.85 +1.3% 142.31 141.75 +9.9%
EUR/CHF 1.0484 +0.7% 1.0417 1.0403 +1.1%
EUR/GBP 0.8544 +0.5% 0.8506 0.8502 +1.7%
USD/JPY 134.27 +1.2% 133.10 132.58 +16.6%
GBP/USD 1.2539 -0.4% 1.2568 1.2576 -7.3%
USD/CNH (Offshore) 6.6953 +0.4% 6.6757 6.6773 +5.4%
Bitcoin
BTC/USD 30,150.32 -3.9% 30,492.92 29,817.82 -34.8%
ROHOEL last VT-Settl. +/- % +/- USD % YTD
WTI/Nymex 122.65 119.41 +2.7% 3.24 +68.5%
Brent/ICE 124.06 120.57 +2.9% 3.49 +64.5%
METALS last day before +/- % +/- USD % YTD
Gold (Spot) 1,852.81 1,852.10 +0.0% +0.71 +1.3%
Silver (Spot) 22.07 22.23 -0.7% -0.16 -5.3%
Platinum (Spot) 1,011.10 1,014.30 -0.3% -3.20 +4.2%
Copper Future 4.45 4.44 +0.2% +0.01 -0.1%
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(END) Dow Jones Newswires
June 08, 2022 16:10 ET (20:10 GMT)
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