(New York) The New York Stock Exchange ended the session, month and half strong on Friday, cheering on slowing U.S. inflation as Apple closed above for the first time. of the bar of 3000 billion dollars of capitalization.
The Dow Jones Index gained 0.84% to 34,407.60 points and the tech-heavy NASDAQ climbed 1.45% to 13,787.92 points, posting its best first half since 1983. The index expanded S
Over the month, the indices gained almost 6% for the NASDAQ and the S
“The past two years have been difficult and it feels good to end this semester on a positive note. I suspect that’s not the end of it,” said Tom Cahill of Ventura Wealth Management.
Inflation in May in the United States, measured by the PCE index, the favorite barometer of the American central bank (Fed), slowed to 3.8% year on year against 4.3% the month before, according to new data from the Commerce Department released Friday. Over a month, it drops to 0.1%.
Another positive indicator in the eyes of the Fed, household spending slowed its growth to 0.1% over the month against 0.6% in April. By raising rates, the central bank seeks to slow down demand, and therefore consumer prices.
“Inflation came out in line with forecasts but the trend continues to be favorable to the downside,” commented Tom Cahill. “Granted it’s not slowing down as fast as the central bank (Fed) would like but there will be a lot of other data before the next monetary meeting,” the analyst told AFP.
In addition to the good news on the inflation side, consumer confidence in June improved markedly, reaching its highest level in four months. The index measuring that confidence rose 8.8% from May more than expected, according to the University of Michigan Barometer.
These data provide grist for the mill “of the doves of the Fed”, that is to say those who are less favorable to the continuation of the hike in key rates, said Andrew Hunter of Capital Economics. According to him, at the monetary meeting at the end of July, the Fed will raise the cost of credit again but that it will be “the last time”.
Taking advantage of the enthusiasm of the NASDAQ, Apple – already the largest group on the stock market – for the first time closed above the 3 trillion mark in capitalization. The stock had to exceed $190 to reach this valuation. It ended on a jump of 2.31% to 193.97 dollars or a capitalization of 3051 billion dollars.
A strong rating from Citigroup bank helped boost the stock, said Patrick O’Hare of Briefing.com. Since the beginning of the year, the title of Apple has climbed more than 50%. “It’s hard to say you’re in a bear market when a token stock like Apple is hitting new highs,” Cahill said.
Elsewhere on the coast, all the big names in technology have had the wind in their sails. On the processor side, Nvidia climbed 3.63% and AMD 2.40%. Meta and Amazon gained almost 2%.
After disappointing results announced the day before after the close, Nike slipped 2.65% to $110.37. The American sports equipment manufacturer recorded a sharp drop in its quarterly net profit, under the effect of markdowns to reduce its inventories and cost increases, despite rising turnover.
As the travel season looks bright, cruise line Carnival has taken off (9.73%), followed by Norwegian Cruise (4.16%).
On the bond market, yields on Treasury bills, which had risen the day before, remained stable at 3.83% for those at ten years.
The Toronto Stock Exchange’s flagship index ended the first half of the year with a strong performance, registering a gain of more than 200 points, while the major American indices also advanced.
The composite index S
The second quarter was “fantastic” for U.S. markets, observed Mike Archibald, vice president and portfolio manager at AGF Investments. The S index
Although the TSX hasn’t done as well comparatively due to its heavy concentration in energy stocks — a sector that has been hurt by falling crude oil prices in recent months — markets on both sides of the border have exceeded expectations for the first six months of 2023.
“The first half of this year was a big surprise for many people. There’s always a lot of money being put to work here, and that’s obviously what we’re seeing here today,” Archibald explained.
Investors are feeling optimistic mid-year, Archibald noted, because an economic recession has yet to materialize.
For much of the past year, central bank interest rate hikes raised fears of a hard landing in the economy. But with inflation easing – annual consumer price inflation in Canada was 3.4% in May, its slowest level in nearly two years – many investors believe the end of the upward cycle rates is close.
That could mean it’s possible for the global economy to dodge the recession many predicted, Archibald said. “I’ve definitely been on the risk side,” he admitted. I personally think the market will continue to rise. »
Even crude oil, which has lost around US$10 a barrel since April on fears of a shrinking global economy, rallied on Friday to close above US$70.
According to Archibald, the rise in oil prices over the past few days probably has more to do with the weakness of the US dollar than anything else, but he added that the longer the feared recession does not materialize, the more likely it is that crude prices rebound.
“If we get more definitive data that the economy is not in a recession and we’re going to see a soft landing, then I think we’ll see some very dynamic catch-up trading in energy stocks. I just don’t know when it’s going to happen,” he explained.
As we approach the second half of 2023, corporate financial results for the second quarter will be the “trump card” when it comes to stocks, Archibald said.
Once earnings reports start rolling out in the coming weeks, investors will have a better idea of the fairness of their economic outlook.
“I don’t mean to sound overtly bullish, but I think the path for equities is pretty good,” he argued.
“If profits go up, then I think there will still be good times ahead of us. »
In the currency market, the Canadian dollar traded at an average rate of 75.53 US cents, up from 75.44 US cents on Thursday.
On the New York Commodities Exchange, crude oil rose 78 cents to US$70.64 a barrel, while natural gas rose nearly 10 cents to US$2.80 a barrel. million BTUs.
The price of gold rose US$11.50 to US$1929.40 per ounce and copper rose 6 cents US to US$3.76 per pound.
