NEW YORK (dpa-AFX) – The US stock exchanges continued to rise a little after the recovery in the middle of the week. the monetary policy and worries about an economic downturn dominated events on Thursday as well, as indicated by slight losses in early trading. The stock market was ultimately supported by gains in bank stocks, which benefited from the prospect of rising interest rates. The leading US index Dow Jones Industrial (Dow Jones 30 Industrial) rose by 0.61 percent to 31,774.52 points. The market-wide S&P 500 went up 0.66 percent to 4006.18 points. The tech-heavy NASDAQ 100 gained 0.50 percent to 12,321.19 points.
The central banks’ battle on both sides of the Atlantic against high inflation is currently the focus of attention. The record inflation in the euro area drove the euro monetary authorities to the greatest rate hike the history of the European Central Bank (ECB). The central bank raised the key interest rate by 0.75 percentage points to 1.25 percent despite growing concerns that the economy could plunge into recession.
The ECB thus followed the trend of the US Federal Reserve – with a significant delay. In view of the persistently high inflation, its boss Jerome Powell recently made it clear that he considers further massive interest rate hikes to be necessary in order to achieve the target of two percent for inflation again. Some stockbrokers, on the other hand, fear that monetary policy could damage economic growth. However, persistently high inflation has even worse consequences for the economy.
Meanwhile, an appearance by the Fed head at an online event organized by the think tank Cato Institute hardly moved the markets. Powell said the Federal Reserve will not relax its efforts to contain inflation “until the job is done.” It is very important that inflation expectations remain anchored.
In the Dow, JPMorgan (JPMorgan ChaseCo) shares are up more than 2 percent. Goldman Sachs shares are up one and a half percent. Higher interest rates would strengthen the earning power of the big banks.
The shares of Regeneron Pharmaceuticals were by far the best value in the Nasdaq 100 with a plus of almost 19 percent. Study data on the eye drug Eylea with a changed dosage were strong, wrote analyst Brian Abrahams from the Canadian bank RBC. The expert believes that approval is more likely and a market switch to the changed dosage is supported to a certain extent.
Rivian (Rivian Automotive) investors were pleased with an increase of around eleven percent. The electric car manufacturer wants to cooperate with Mercedes-Benz (Mercedes-Benz Group (ex-Daimler)) in the production of electric vans. Both companies want to set up a joint venture for production, invest in a common factory in Europe and operate it together. Meanwhile, the shares of Mercedes-Benz in Frankfurt fell by almost two percent. Car stocks also suffered losses throughout Europe.
The papers of the solar technology specialist First Solar gained around two percent. This was supported by a positive analyst comment from Goldman Sachs. Analyst Brian Lee sees the company as the biggest beneficiary of the US government’s plans to significantly expand solar energy.
The euro last cost 0.9998 US dollars in New York. The European Central Bank had set the reference rate at 1.0009 (Wednesday: 0.9885) dollars. The dollar thus cost 0.9991 (1.0116) euros. In the US bond market, the 10-year Treasury futures contract (T-Note future) fell 0.30 percent to 115.83 points on Wall Street gains. In return, the yield on ten-year government bonds rose to 3.32 percent./la
— By Lutz Alexander, dpa-AFX —