(New York) Wall Street was trading lower on Wednesday on the heels of several bank results as bond yields rallied.
The Dow Jones index lost 0.31%, the tech-heavy NASDAQ dropped 0.57% and the S
The day before, Wall Street had concluded stable. The Dow Jones had just lost 0.03% to 33,976.63 points, the NASDAQ 0.04% to 12,153.41 points while the broader index S
US investment bank Morgan Stanley saw net profit slip 20% in the first quarter as companies use its services less for buyouts.
Between the uncertainties about the direction of the economic situation, the rise in interest rates and the volatility of the markets, the bosses are indeed reluctant to initiate takeovers or raise money on the markets.
Morgan Stanley has also increased its provisions a little, due to higher risks around commercial real estate and the deterioration of the economic outlook.
The stock, which opened more than 2% lower, retraced the lost ground to -0.28% around 10:20 a.m. EST.
Despite good results announced at the start of the week, the banks were also slightly in the red, notably JPMorgan (-0.06%), Citigroup (-0.62%) and Bank of America (-2%).
Regional banks, on the other hand, in the spotlight since the mini-bank panic in March, regained strength such as Western Alliance (16.83%), PacWest (5.85%) or First Republic (3.42%).
On the NASDAQ, so-called growth stocks suffered from the rise in bond rates.
The yield on two-year Treasury bills stood at 4.26% against 4.19% the day before, and that on 10-year bills rose to 3.61% against 3.57%.
Netflix, which reported mixed results after the close on Tuesday, was punished, with the stock losing almost 4%.
The streaming veteran saw his number of subscribers grow in the first quarter to 232.5 million, but less than expected. In addition, its profit fell by 18% year on year.
Netflix’s weakness “darkens the market mood”, said Patrick O’Hare of Briefing.com.
Meta (Facebook) lost 1.79%, Alphabet (Google) lost 1.16% and Tesla, which announces its first quarter results after the close, fell 2.71%.
Elsewhere on the coast, the airline United Airlines was on the rise (3.32%). Although it lost money in the first quarter, it is betting on strong demand for the future.
On the macroeconomic side, in the second part of the session the Federal Reserve (Fed) will publish the Beige Book on Wednesday, its last economic report before its next monetary meeting on May 2 and 3.
“Several Fed officials stressed the need for an additional rate hike following the rise in the CPI core inflation index in March, but crucially, none of them argued. in favor of a rate cut at the end of the year,” noted Patrick O’Hare of Briefing.com.
Now there is an 80% chance, according to CME calculations on futures products, that the central bank will raise rates another quarter point, which would put them between 5% and 5.25%.
News of UK inflation persisting at 10.1% year on year also strained the bond market.
