NEW YORK (Dow Jones) – Falling market interest rates supported technology stocks on the US stock exchanges in particular on Monday. On the broader market, however, the price gains crumbled in late trading because investors focused more attention on the earnings season, traders said. Many investors have withdrawn as a precaution before the figures from some heavyweights in the US corporate landscape will be reported in the coming days.
The Dow Jones Index closed 0.6 percent lower at 32,936 points, the S&P 500 fell 0.2 percent, while the Nasdaq Composite rose 0.3 percent. 911 (Friday: 788) stocks recorded price gains, while 1,974 (2,069) stocks lost price and 73 (98) stocks closed unchanged.
The yield on ten-year US bonds temporarily rose above 5 percent on Monday for the first time since 2007, meaning stocks suffered from strong competition. However, this level could not be maintained. In late trading, the 10-year yield fell 8.2 basis points to 4.84 percent. The high interest rate level had attracted buyers. Michael Hewson, chief market analyst at CMC Markets, also referred to a tweet from investor Bill Ackman that his hedge fund Pershing Square was shorting the bond market. Ackman wrote that the US economy was weaker than it initially appeared.
Yields were recently supported by the fact that the Middle East war did not escalate over the weekend. So far, Israel has not launched a major ground offensive in the Gaza Strip, and Hamas has also released two US hostages. Finally, reference was made to the US government’s increased need for money due to the Middle East war, but the war in Ukraine also continued to consume large sums of money.
The yield had already risen sharply to close to 5 percent in the previous week after Fed Chairman Jerome Powell issued another Interest rate increase had not been completely ruled out. In addition, good retail data had weighed on bonds.
Otherwise, investors are concentrating on the reporting season this week. Microsoft, Meta, Alphabet and Amazon, among others, are reporting over the course of the week. The participants act cautiously in advance.
Oil and gold easier
Oil prices did not continue their recent rise, but trended weaker on Monday. Here too, participants cited the lack of expansion of the Middle East war as the reason. The same applied to the price of gold, which had risen in the wake of the Middle East war. He gave in slightly.
The dollar followed bond yields lower. The dollar index fell by 0.4 percent. However, a series of US data is on the agenda later this week. Among other things, the purchasing managers’ indices for October and the US GDP for the first quarter will be published. The data is likely to be “broadly good, but not enough to reinforce expectations of further Federal Reserve tightening,” Unicredit said.
Among the individual stocks, Troika Media fell by 31 percent. The marketing and communications company said there were significant doubts about whether the business would continue. The company also reported a 31 percent decline in fiscal second quarter revenue to $58.7 million.
Shares of Hess (-1.1%) did not benefit from Chevron (-3.7%) acquiring the company for $53 billion in shares. Market participants pointed to the meager premium of just 5 percent to the closing price of Hess shares on Friday. In addition, Hess had already made strong gains in takeover speculation after Exxon Mobil (-1.5%) announced its purchase of Pioneer Natural Resources (-1.5%). Oil industry stocks were largely impacted by the drop in oil prices.
FMC Corp fell 13.2% after the chemical company issued a profit warning. Okta lost another 8.1 percent. After it became known on Friday that the identity and access management specialist had again fallen victim to a cyber attack, analysts now feared that the company would lose customers. Biontech (+1.8%), on the other hand, benefited from promising results from a drug study. Arm Holdings rose 4.9 percent in response to a media report that Nvidia (+3.8%) and Advanced Micro Devices (-1.8%) will use the company’s technology to develop a new chip.
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INDEX last +/- % absolute +/- % YTD
DJIA 32,936.41 -0.6% -190.87 -0.6%
S&P 500 4,217.04 -0.2% -7.12 +9.8%
Nasdaq Comp. 13,018.33 +0.3% 34.52 +24.4%
Nasdaq-100 14,604.85 +0.3% 43.97 +33.5%
US bonds
Maturity Yield Bp to VT Yield VT +/-Bp YTD
2 years 5.06 -4.7 5.11 63.8
5 years 4.81 -6.1 4.87 80.8
7 years 4.86 -7.3 4.93 89.2
10 years 4.84 -8.2 4.93 96.4
30 years 5.00 -8.5 5.09 103.4
FOREX last +/- % Mon 8:12 am Fri 5:30 pm % YTD
EUR/USD 1.0666 +0.7% 1.0575 1.0595 -0.4%
EUR/JPY 159.61 +0.5% 158.56 158.74 +13.7%
EUR/CHF 0.9506 +0.6% 0.9463 0.9437 -4.0%
EUR/GBP 0.8709 -0.0% 0.8703 0.8717 -1.6%
USD/JPY 149.66 -0.1% 149.93 149.82 +14.1%
GBP/USD 1.2248 +0.7% 1.2152 1.2155 +1.3%
USD/CNH (Offshore) 7.3098 -0.2% 7.3264 7.3231 +5.5%
Bitcoin
BTC/USD 31,432.09 +5.5% 30,755.89 29,595.23 +89.4%
ROHOEL most recently VT-Settlem. +/-% +/- USD% YTD
WTI/Nymex 86.04 88.08 -2.3% -2.04 +11.3%
Brent/ICE 90.33 92.16 -2.0% -1.83 +10.5%
METALS last day previous +/- % +/- USD % YTD
Gold (spot) 1,972.91 1,981.23 -0.4% -8.32 +8.2%
Silver (spot) 22.98 23.37 -1.6% -0.38 -4.1%
Platinum (spot) 898.98 900.70 -0.2% -1.73 -15.8%
Copper future 3.58 3.56 +0.5% +0.02 -6.0%
YTD based on the previous day’s closing level
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(END) Dow Jones Newswires
October 23, 2023 4:11 p.m. ET (8:11 p.m. GMT)