The Dow Jones continued to rise for a fifth straight day on Tuesday after the market appeared to interpret Powell’s remarks as less hawkish than feared.
“This is a market that mimics what the FED is doing. The market has already digested Powell’s comments,” said Quincy Krosby, chief global economic strategist at LPL Financial. Which added that it is clear that interest rates, and the speed at which interest rates rise higher or fall lower, are very important to the market.
Handelsbanken also writes in an update that the market is now increasingly expecting a cut in September.
“The market continues to ride the wave. This after Powell appeared less hawkish than feared last week, at the same time that the US labor market figures showed a more marked cooling. Thus, cut speculation is kept more alive, and the market is now increasingly set on the US interest rate being cut in September, and then eyes a further cut in December. But it is still not fully priced,” writes Handelsbanken in an update.
The 10-year yield fell to 4.46 percent, while the 30-year yield fell to 4.60 percent on Tuesday.
On Wednesday, the S&P 500 rose 0.13 percent to 5,187.68, while the technology index Nasdaq fell 0.1 percent to 16,332.56. Industry-heavy Dow Jones rose 0.08 percent to 38,883.80.
The volatility index – VIX – fell 2.15 percent to 13.2.
Movements
Disney reported earnings that topped analysts’ estimates. Nevertheless, the share fell 9.5 percent.
The company’s streaming entertainment applications, Disney+ and Hulu, posted a profit for the first time, according to CNBC. Combined with ESPN+, however, the streaming businesses lost $18 million in the quarter, significantly less than the loss of $659 million a year ago.
Furthermore, Peloton rose over 15 percent after CNBC reports that several private equity firms are considering a potential acquisition of the company. According to sources familiar with the matter, the talks have centered on how to make the company more attractive by cutting costs after 13 quarters of losses.
The largest technology companies have accounted for a large part of the stock market rise in the USA in recent years. Facebook owner Meta, Amazon, Netflix, Apple and Alphabet (also known as the FAANG stocks), had a good day on the stock exchange on Tuesday.
- Facebook rose 0.55 percent to $468.24.
- Amazon rose 0.03 percent to $188.76.
- Apple rose 0.38 percent to $182.40.
- Netflix rose 1.51 percent to $606.00.
- Alphabet rose 1.87 percent to $171.25.
Oil and gas
The June WTI contract rose 0.01 percent to $78.49 a barrel. barrels, while Brent oil fell 0.12 percent to 83.21 dollars per barrel.
US natural gas rose 0.83 percent to $2.21 per barrel. MMBtu. The European natural gas (TTF) fell 3.50 percent to 30.72 euros/MWh.
Crypto
Bitcoin rose 0.15 percent to 63,149.00, while Ethereum ticked down 0.26 percent to 3,055.14.
