The New York Stock Exchange ended higher on Thursday, continuing its momentum despite the rate hike by the American Central Bank (Fed), in a market confident in the health of the American economy.
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The Dow Jones advanced 1.23% to 34,480.76 points, the technology-heavy Nasdaq index gained 1.33% to 13,614.78 points, and the broader S&P 500 index gained 1, 23% to 4,411.67 points.
After a fourth consecutive session of gains, the Dow Jones returned to its level of a month ago, as did the S&P 500, which was before the start of the invasion of Ukraine.
Starting in the red, on profit-taking and concerns about the statements of the United States and Russia on Ukraine, the indices gradually recovered over the course of the session, before ending resolutely in the green.
“The Fed has probably been a little more aggressive than expected, but not enough to deflect the markets from their trajectory,” said Ross Mayfield, an analyst at Baird.
In addition to raising its rate by a quarter point, the Fed also signaled that an overwhelming majority of its members were expecting seven hikes in 2022, which surprised economists.
Scotiabank’s Juan Manuel Herrera said Fed Chairman Jerome Powell’s optimistic remarks on the US economy “pleased markets, especially equity markets, but also other currencies against the dollar, in a more favorable atmosphere. at risk”.
“The American economy is very solid”, abounded Ross Mayfield. Even taking into account the uncertainty over Ukraine and the surge in commodity prices, “with six or seven increases, you are still relatively accommodating” on the monetary level, according to him.
Even after this expected series of increases, “real interest rates will always be negative,” added Lloyd Blankfein, who headed Goldman Sachs from 2006 to 2018 and is still senior chairman, in a tweet.
A key rate of between 1.75% and 2%, as expected at the end of 2022, would thus still be well below the current level of inflation.
“The Fed’s monetary policy is pushing the equity markets less in the back, but that’s not a headwind for all that,” he argued.
The VIX index, which measures market volatility, fell to its lowest level in a month, a sign of market easing, even if nothing is resolved in Ukraine, where the fighting continues.
Taking advantage of this prolonged thinning, the companies most mistreated on Wall Street in recent months have put their noses outside.
The online gaming platform Roblox, which had lost three quarters of its value since its peak at the end of November, thus gained 11.66%, to 46.35 dollars.
Sunny day also for Block (formerly Square, +10.26%) and WeWork (+12.86%), but also Peloton (+5.96%) or Netflix (+3.88%), which had found, in beginning of the week, its pre-pandemic course.
Have the oil companies taken advantage of the rebound in the price of black gold? Occidental Petroleum (+9.47%) and Marathon Oil (+6.86%) were at the party, as was ConocoPhillips (+4.23%).
After a crazy day on Wednesday, which saw some stocks gain more than 20% after comments from Chinese authorities in favor of listing outside China, Chinese companies on Wall Street were hungover.
The e-commerce platforms Alibaba (-4.39%), JD.com (-3.34%) or Pinduoduo (-7.63%) have all fallen sharply.
Ralph Lauren benefited (+4.58% to 119.22 dollars) from a note from JPMorgan which predicts that the clothing brand will be among the winners of the gradual return of employees to the office, at the end of the pandemic.
Reference-www.tvanouvelles.ca