(New York) The New York Stock Exchange concluded divided on Friday, not far from equilibrium, another negative week, the third in a row, weighed down by a surge in bond rates.
The Dow Jones index climbed 0.07% to 34,500.66 points, the tech-heavy NASDAQ fell 0.20% to 13,290.78 points and the S
The fall in the prices of long-term US Treasuries, which caused their yields to rise sharply during the week to the point of touching their highest levels in 16 years on Thursday, was halted on Friday.
Ten-year bond yields, which were 4.30% mid-week, fell to 4.25%, allowing equities to breathe.
“It’s been a tough week,” acknowledged Tom Cahill of Ventura Wealth Management, interviewed by AFP as New York indices lost another 2%.
“On Friday, a lot of investors looked at bond prices, thought they were getting really attractive, and stepped in to buy, which pushed yields down and was positive for equities,” the analyst explained.
Bond yields rise when bond prices fall.
The rise in bond rates, the event of the week, was notably caused by the strict attitude of the American Federal Reserve (Fed) reflected in the minutes of its last meeting published on Wednesday.
The Monetary Committee indicated that it was ready to raise interest rates further if necessary and that in any case they would remain high for some time.
For Tom Cahill, the new weekly decline in stocks was “no surprise”.
“The good year-to-date performance in equities has been driven by a handful of large companies” in the technology sector in particular, he recalled.
“And when interest rates go up, it contracts their multiples”, that is to say their market valuation calculated in relation to their net income, the analyst further explained.
Alphabet (parent company of Google) lost 1.80%, Meta (Facebook) lost 0.65%, Tesla ended down 1.70%.
Trading volumes remained light on a mid-August Friday devoid of macro news.
Next week, eyes will be on the meeting of central bankers in Jackson Hole where U.S. Federal Reserve (Fed) Chairman Jerome Powell and ECB President Christine Lagarde are due to deliver speeches on Friday.
On the stock market, the American beauty products group Estée Lauder fell 3.31%, as cosmetics sales suffered from the sluggish recovery in its Asian markets, particularly in China.
Annual revenue fell 10% year-on-year to $15.91 billion and net profit was $1.01 billion, down 58%.
Deere agricultural machinery far exceeded analysts’ expectations with quarterly earnings per share of $10.20 versus $8.22 expected as revenue climbed to $14.3 billion from $13 billion a year earlier .
But the stock plunged 5.28% as investors were less optimistic about future demand for agricultural equipment.
Semiconductor group Applied Materials gained 3.68% after better-than-expected results and guidance.
Moderna Laboratories returned the bulk of yesterday’s earnings (4.35%). The COVID-19 vaccine maker said on Thursday that its new version of the serum was effective against new variants called Eris and Fornax, according to a preliminary study.
Canada’s main stock index posted a gain on Friday, helped by strength in the energy and utilities sectors.
The composite index S
In the forex market, the Canadian dollar traded at an average rate of 73.79 US cents, down from 73.94 US cents on Thursday.
