(New York) The New York Stock Exchange ended in disarray on Monday in the face of a jump in oil prices which, however, did not provoke a panic reaction in the stock and bond markets.
The Dow Jones index ended up 0.98% at 33,601.15 points, the S
Oil prices soared some 6.30% for both Brent crude and Texas WTI oil after eight of OPEC’s 23 countries, including Saudi Arabia, announced on Sunday a cut , from the month of May, of their production.
The decline will exceed one million barrels per day (bpd), the largest reduction since October.
“We had a risky event this weekend and it wasn’t the banks this time but OPEC,” summed up Karl Haeling of LBBW.
More expensive oil apparently complicates the task of the American Federal Reserve (Fed) which has drastically raised interest rates to curb inflation which remains stubborn.
The White House took little notice of the announcement from Saudi Arabia, the United Arab Emirates, Oman, Kuwait, Algeria and Iraq.
“It is not appropriate to curtail production at this time given market uncertainties,” a White House National Security Council spokesperson said.
But overall, the markets reacted “quite calmly,” Karl Healing said. “There was already a feeling that OPEC wouldn’t have cut production if it weren’t for the concern of slowing demand and falling crude prices,” he told the AFP.
During the morning, the ISM indicator of manufacturing activity in the United States confirmed the presumptions of the coming slowdown. At 46.3%, the index fell to the lowest since May 2020.
“As soon as the ISM was released, there was a perception that lower OPEC production was going to be more than offset, in terms of price action, by lower demand and a weaker economy. world,” commented the analyst.
Thus, despite the rise in oil prices, which could raise fears of more inflation, yields on Treasury bills eased: 3.40% instead of 3.46% on Friday for ten-year bills years around 4 p.m. Those at two slipped below 4% to 3.96%.
Likewise the NASDAQ, which was losing more before the ISM release, recovered some ground as the rising Dow Jones solidified.
On the stock market, oil stocks took advantage of the situation. The energy sector (4.91%) led all seven of the 11 sectors in the S
Oil services groups pranced in the lead like Halliburton (7.76%) or Schlumberger (6.59%). ConocoPhilips soared 9.29%. Exxon Mobil gained 5.89% and Chevron 4.16%.
Sensitive to the rise in fuel prices, the travel sector suffered the blow, like Expedia (-2.02%), Airbnb (-2.36%) or airlines such as United Airlines (-2 .03%) or American Airlines (-2.24%).
The US competition authority, the FTC, has vetoed the merger of biotechnology company Illumina (-1.09%) with cancer test developer Grail.
This merger, valued at 7 billion dollars, which the FTC had already opposed for reasons of respect for competition, had subsequently been authorized by an American administrative judge. The FTC finally had the final say.
Tesla shares slid 6.12% despite an increase in the number of its vehicles delivered in the first quarter, an improvement mainly thanks to price cuts by the electric carmaker.
In the ring, the professional wrestling line WWC (World Wrestling Entertainment, WWE) suffered badly (-2.15%) from its announced merger with the Ultimate Fighting Championship (UFC).
Entertainment juggernaut Endeavor (-5.81%), owner of the UFC, will hold the majority in the new entity which will be listed on the New York Stock Exchange in the second half. It is valued at over $21 billion.