(New York) The New York Stock Exchange reversed course on Thursday and finished in the red after the announcement of higher-than-expected US inflation which pushed up bond yields and put stocks at a disadvantage.
The Dow Jones index lost 0.51% to 33,631.14 points, the technology-heavy NASDAQ lost 0.63% to 13,574.22 points and the S
Wall Street initially opened in the green, but changed direction after digesting the news of more stubborn inflation than expected.
Price growth remained at 3.7% year-on-year in September, according to the CPI index published by the Labor Department. This rate disappointed analysts, who expected a slight slowdown, to 3.6% year-on-year, according to the MarketWatch consensus.
Over just one month, however, inflation slowed for the first time since May, to 0.4% – more than expected nonetheless – compared to 0.6% in August.
The turnaround in the indices, which have aligned positive sessions since Friday, “happened because of inflation and interest rates,” explained Jack Ablin, investment strategy specialist at Cresset.
“Inflation was above expectations and the yield on ten-year Treasury bonds rose by five basis points,” summarized the analyst. However, he thinks that this inflation figure is not strong enough “to change the views we have on the Federal Reserve (Fed), but it is just a little disappointing”.
Yields on 10-year Treasury bonds resumed their upward trajectory to 4.70% from 4.55% the day before. Those at two years have again exceeded 5%.
For the November 1 monetary meeting, investor consensus favors a status quo for the Fed’s key rates for the second time in a row.
The question for the American central bank (Fed) is now no longer how high rates will rise, now at or near their peak, but how long to maintain them at this level, the minutes of the last meeting revealed published Wednesday.
Elsewhere in the world, the bloody attack launched on Saturday by Hamas causing thousands of deaths and nearly 150 hostages and Israel’s reprisals were clouding minds, but not really weighing on the market, noted the analyst from Cresset.
On the stock market, automaker Ford lost 2% to $12 as the United Auto Workers union extended its strike to the unit that makes SUVs and pickup trucks in Kentucky. General Motors also dropped 2.13%.
Shares of tobacco manufacturer BAT (British America Tobacco) fell 3.80% after a warning from the US health agency (FDA) banning the sale of menthol electronic cigarettes from its Vuse Alto brand ( RJ Reynolds).
The FDA on Thursday ordered RJ Reynolds Vapor Company (a subsidiary of BAT) not to market six flavors of electronic cigarettes in the United States, including three menthol flavors sold under the Vuse Alto brand.
Pepsico (-2.79%) largely lost the ground gained at the start of the week after revising its results forecasts for 2023 upwards.
Target supermarkets gained 1.66% after being rated highly by analysts at Bank of America.
The sandals of the German manufacturer Birkenstock, introduced on the New York Stock Exchange on Wednesday without much success (-12%), fell by another 6.57% to close at 37.56 dollars, almost 10 dollars less than its price. introduction the day before.
Delta airline fell 2.39% despite record quarterly sales. However, for the year as a whole, the group expects an increase of around 20% in its turnover.
On Friday “we will have announcements of banking results and next week those of several consumer companies,” underlined Mr. Ablin. “This should give us a good idea of the health of the consumer, a key factor in the direction of the market,” he added.
The Toronto Stock Exchange closed lower on Thursday, undermined by losses in the utilities, base metals and telecommunications sectors, while the major American indices also retreated, following the publication of the most recent data on inflation south of the border.
The composite index S
In the currency market, the Canadian dollar traded at an average rate of 73.22 US cents, down from 73.51 US cents on Wednesday.
On the New York Mercantile Exchange, crude oil prices fell 58 US cents to US$82.91 per barrel, while natural gas fell 3 US cents to US$3.34 per million BTUs. .
The price of gold fell US$4.30 to US$1,883.00 per ounce and that of copper depreciated by US$2 cents to US$3.59 per pound.
