(New York) The New York Stock Exchange was trading lower on Tuesday on concerns about the Chinese economy after a series of disappointing indicators and a rate cut from the Chinese central bank, while consumption remains solid in the United States.
The Dow Jones index lost 0.85%, the tech-heavy NASDAQ dropped 0.89% and the S index
The day before, Wall Street had finished in the green. The Dow Jones index climbed 0.07% to 35,307.63 points, the NASDAQ climbed 1.05% to 13,788.33 points and the S index
On Tuesday, despite the good news of a stronger-than-expected rise in U.S. retail sales in July, investors kept their eyes on poor numbers from China’s economy.
China’s central bank cut its benchmark rate to 2.50% to encourage lending as industrial production growth stalled and retail sales rose just 2.5% year-on-year in July, much less than expected.
In the United States, the good health of the consumer was a surprise with an increase in retail sales in July of 0.7% against 0.4% expected for the month and 3.2% year on year.
“July’s jump in retail sales suggests that monetary policy tightening still has remarkably little impact on real economic activity,” noted Andrew Hunter of Capital Economics.
The analyst noted, however, that consumption of durable goods held up less well than sales of everyday products, with a drop in car purchases (-0.4%), furniture sales (-1.8%) and appliances (-1.3%).
For Kieran Clancy of Pantheon Macroeconomics, “it’s too early to say that consumer spending has started to pick up again.”
On the manufacturing side, the news was less good with a plunge in the activity barometer of the Federal Reserve (Fed) of New York. The Empire State index measuring such activity fell 20 points from July to -19 points, according to the monthly survey.
On the inflation front, import prices rose 0.4% in July, the biggest rise in more than a month, driven by rising energy costs.
On the odds, the DIY giant Home Depot climbed almost 1% after announcing results very slightly better than expected in the second quarter.
The brand, which had lowered its annual forecasts in the previous quarter, confirmed them this time while noting that consumers were more reluctant to make large expenditures on purchases of durable goods such as washing machines or refrigerators.
All eleven sectors of the S
Bank of America and JPMorgan dropped more than 2%, Citigroup and Goldman Sachs lost 1.60%.
Retailers Target and Walmart, whose results are expected later this week, were down more than 0.20%.
Profit taking occurred on technology which had risen well the day before. Thus Amazon yielded 1.20%, Apple -0.60%, Meta (Facebook) -0.85% while Tesla dropped 1.40%.
A newcomer to Wall Street, Vietnamese electric vehicle maker Vinfast was making a bumpy debut on NASDAQ. The new VFS title introduced at 22 dollars on the NASDAQ via a SPAC yielded 4.09% to 21.10 dollars during very volatile first exchanges.
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