(New York) The New York Stock Exchange opened lower on Thursday, digesting another Fed interest rate hike as U.S. regional banks came under renewed pressure.
The Dow Jones index was down 0.97%, the tech-heavy NASDAQ was down 0.58% and the broader S
The day before, the Dow Jones fell 0.80% to 33,434 points, the NASDAQ fell 0.46% to 13,099.75 points and the S
The titles of regional banks were again the target of massive sales, in particular the Californian establishment PacWest which fell by more than half (-52%) to no longer be worth only 3.05 dollars.
The regional bank issued a statement overnight indicating that it was examining sales of strategic assets.
She assured not to have recorded “ exceptional movements ”, after the collapse of First Republic Bank, which had to be bought out in disaster last weekend by JPMorgan.
Western Alliance plunged 45.25% and Zions Bancorporation fell 15%.
“ We did not have a period of calm after the takeover of First Republic ”, noted Edward Moya, from Oanda. “The target has moved from one bank to another and the sector is in trouble. »
“This banking crisis is something we will have to deal with until the end of the year, and even beyond,” he added. “ There will be more banks under stress ”.
Big names in the industry were also hurting: JPMorgan Chase, Citigroup, Bank of America were all down more than 2% by 10:15 a.m. EST.
The Fed for its part focused on Wednesday “ to minimize ” this banking crisis, commented for his part Chris Low of FHNFinancial. “ The banking system is healthy and resilient ”, assured the press release from the Monetary Committee of the American central bank.
“It is good that Jerome Powell has said that the Fed is determined to learn the lessons of the crisis, but he himself, like other regulators, has not gained credibility by minimizing the risks,” added the economist.
Still in the banking sector, the Canadian bank TD Bank has announced that it will abandon its merger with the American lender First Horizon for regulatory reasons. First Horizon was melting almost 40%.
In addition to this renewed pressure on the banks, the attitude of the Federal Reserve (Fed), which retains the option of taking a break on rates, but also of raising them if inflation resists and in any case certainly not lower this year, did not satisfy the markets.
“ The stock market did not necessarily like what it heard from the Monetary Committee and from Chairman Jerome Powell, mainly because it does not go in the direction of an upcoming rate cut”, commented Patrick O’Hare of Briefing.com.
Elsewhere on the stock exchange, Paramount Global fell 22% after announcing a quarterly loss of $1.12 billion against a profit of $433 million a year earlier, despite an increase in its subscribers to its streaming service. The group has reduced its dividend.
After the close, the giant Apple (-1.22% around 10 a.m. Eastern Time) will announce its results for its second quarter. Analysts expect a decline of 4.8% in turnover and 5.8% in profit. It would be the first drop in sales since 2019.
Semiconductor specialist Qualcomm lost more than 6% after announcing a disappointing outlook for the third quarter.