(New York) The New York Stock Exchange opened in disarray on Monday, worried about soaring oil prices that pose a new threat to the economy, potentially reigniting inflation.
The Dow Jones Index advanced 0.98%, but the tech-heavy NASDAQ fell 0.48%, while the broader S index
On Friday, Wall Street ended a turbulent quarter in the green. The NASDAQ had gained 1.74%, the Dow Jones 1.26% and the S
Over the quarter, which in March saw a mini bank panic among regional banks and another Fed rate hike, the broader S
On Monday, oil prices rose by more than 6.50% after the surprise announcement on Sunday by several major exporting countries of a reduction, from May, in their production.
The decline will exceed one million barrels per day (bpd), the largest reduction since October.
“The jump in oil prices is dampening risk appetite” in markets and “already causing concerns about inflation,” said Joe Manimbo of Convera Financial Services.
More expensive oil also complicates the task of the US Federal Reserve (Fed), which has drastically raised interest rates to curb persistent inflation.
The Fed aims to bring price inflation down to 2%, but the latest PCE index, the monetary institution’s favorite gauge published on Friday, still came in at 5% year on year in February.
The White House did not appreciate the announcement from Saudi Arabia, the United Arab Emirates, Oman, Kuwait, Algeria and Iraq.
“It is not appropriate to cut production at this time given market uncertainties,” a spokesperson for the White House National Security Council said Monday. “We will continue to work with all producers […] to ensure that energy markets support economic growth and that prices remain low for American consumers,” he added.
On the coast, oil stocks took advantage of the situation. The energy sector topped the eleven sectors of the S
Oil services groups were the best performers such as Halliburton or Schlumberger, which climbed more than 8%, as did ConocoPhilips. Exxon Mobil was up more than 5% and Chevron nearly 4% by 9:50 a.m. EST.
Tesla shares fell 4.42% to $198 despite an increase in the number of its vehicles delivered in the first quarter, an improvement recorded mainly thanks to price reductions from the electric manufacturer.
In the ring, the professional wrestling line WWC (World Wrestling Entertainment, WWE) took badly (-4.65%) its announced merger with the Ultimate Fighting Championship (UFC).
Entertainment juggernaut Endeavor (-0.38%), owner of the UFC, will own a 51% majority stake in the new entity, which will list on the New York Stock Exchange in the second half. It is valued at over $21 billion.
The first week of the quarter was a shortened week with markets closed on Good Friday, however one important indicator will dictate investor positions.
On Friday, the Labor Department will release official US employment numbers for March. Analysts expect a slight reduction in job creation to 239,000, a figure that remains solid while the unemployment rate is expected to remain stable at 3.6%, still near an all-time low.
