NEW YORK (Dow Jones) – Disappointment over unexpectedly high US producer prices dampened the buying mood on Wall Street on Friday. Initially it looked like prices would continue to rise and potentially reach new record highs, before inflation data threw a spanner in the works. At 0.3 percent, producer prices rose noticeably more month-on-month than expected at 0.1 percent, and the core rate even increased by 0.5 percent.
This created headwinds for stocks from the interest rate side, as was recently seen with the negatively surprising consumer prices. The fact that there is a long weekend ahead may also have contributed to the reluctance. Business in the USA will be closed on Monday due to the Washington’s Birthday holiday.
Yields on the bond market shot up. In the ten-year range, they temporarily reached their highest level since the end of November 2023. Building permits provided a small counterweight to the interest rate prospects. They fell much more significantly in January than expected. And the University of Michigan’s consumer sentiment index in February came in at 79.6, slightly missing the economists’ consensus estimate of 80.0.
The Dow Jones Index closed 0.4 percent lower at 38,628 points. The S&P 500 lost 0.5 percent. The technology-heavy Nasdaq Composite fell 0.8 percent. The 942 (Thursday: 2,359) price winners on the Nyse were compared to 1,877 (497) losers, while 77 (51) stocks left trading unchanged.
The recent upward trend on the US stock market was driven by economic confidence in view of consistently robust US economic data. The other side of the coin is that robust economic figures run counter to hopes that interest rates in the USA will soon fall. Producer prices now took the same line. On the interest rate futures market, the probability of a first Interest rate cut In June, it promptly fell from 80 percent the day before to just under 70.
According to observers, the fact that the price losses on Friday were ultimately mostly limited was because the data did not change the fact that inflation overall is on the decline. A postponement of interest rate cuts alone is not perceived as a catastrophe. Doubts about a “bullish” event – in this case interest rate cuts – must be distinguished from fears about “bearish” events such as a rebound in inflation or a slump in the economy, said Tim Hayes, chief global investment strategist at Ned Davis Research.
Appropriately, the dollar gave up temporary gains. The dollar index was little changed recently.
Applied Materials with significant increase according to figures
On the corporate side, Applied Materials provided positive momentum to the technology segment. The supplier to the semiconductor industry performed better than expected in its first quarter and gave a positive outlook. The share rose by 6.3 percent.
Nike lost 2.4 percent. The sporting goods manufacturer announced that it would reduce its workforce by around 2 percent or 1,600 employees. Doordash fell 8.1 percent. The food delivery service exceeded expectations in its fourth quarter; However, in trading it was said that given the shares had previously performed very well, some market participants would have been betting on even better figures.
Although Draftkings significantly reduced its loss in the quarter under review, analysts had even expected a profit. The sports betting provider’s share price recovered from initial losses and rose by 0.2 percent. Roku fell by around 24 percent. The streaming service provider missed expectations amid a weaker advertising environment. Trade Desk, on the other hand, rose 17.5 percent, driven by an unexpectedly strong outlook. The crypto exchange Coinbase (+8.8%) closed a quarter with a profit for the first time in almost two years.
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INDEX last +/- % absolute +/- % YTD
DJIA 38,627.99 -0.4% -145.13 +2.5%
S&P 500 5,005.57 -0.5% -24.16 +4.9%
Nasdaq Comp. 15,775.65 -0.8% -130.52 +5.1%
Nasdaq-100 17,685.98 -0.9% -159.74 +5.1%
US bonds
Maturity Yield Bp to VT Yield VT +/-Bp YTD
2 years 4.66 +8.3 4.57 23.7
5 years 4.28 +6.6 4.21 27.9
7 years 4.30 +5.9 4.24 32.9
10 years 4.28 +5.8 4.23 40.3
30 years 4.44 +2.9 4.41 47.0
FOREX last +/- % Fri, 8:49am Thu, 5:16% YTD
EUR/USD 1.0776 +0.0% 1.0763 1.0757 -2.4%
EUR/JPY 161.87 +0.2% 161.67 161.58 +4.0%
EUR/CHF 0.9495 +0.2% 0.9483 0.9473 +2.3%
EUR/GBP 0.8553 +0.1% 0.8547 0.8550 -1.4%
USD/JPY 150.21 +0.2% 150.22 150.20 +6.6%
GBP/USD 1.2598 -0.0% 1.2591 1.2581 -1.0%
USD/CNH (Offshore) 7.2131 -0.1% 7.2198 7.2194 +1.3%
Bitcoin
BTC/USD 51,806.92 +0.2% 51,849.87 51,859.04 +19.0%
ROHOEL most recently VT-Settlem. +/-% +/- USD% YTD
WTI/Nymex 79.17 78.03 +1.5% +1.14 +9.7%
Brent/ICE 83.31 82.86 +0.5% +0.45 +8.3%
GAS VT Settlem. +/- EUR
Dutch TTF 24.69 24.98 -1.1% -0.29 -22.3%
METALS last day previous +/- % +/- USD % YTD
Gold (spot) 2,012.81 2,004.41 +0.4% +8.41 -2.4%
Silver (spot) 23.40 22.98 +1.8% +0.42 -1.6%
Platinum (spot) 908.30 900.50 +0.9% +7.80 -8.4%
Copper future 3.83 3.76 +1.8% +0.07 -1.7%
YTD based on the previous day’s closing level
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DJG/DJN/cln
(END) Dow Jones Newswires
February 16, 2024 4:10 p.m. ET (21:10 GMT)