(New York) The New York Stock Exchange closed higher on Tuesday, supported by falling bond yields, as investors keep a wary eye on geopolitical risks in the Middle East.
The Dow Jones Index gained 0.40% to 33,739.30 points, the tech-heavy NASDAQ advanced 0.58% to 13,562.84 points and the S
Yields on Treasury bills fell significantly, which favored stocks.
Ten-year bonds stood at 4.64% compared to 4.80% at the last session, while the bond market remained closed on Monday due to a public holiday (Columbus Day). Two-year yields stood at 4.95%, up from 5.08% at the last close.
The decline in bond yields reflects “partly a flight to quality” and investment security “because of the situation in Israel,” acknowledged Karl Haeling of LBBW.
US President Joe Biden said Tuesday he was ready to deploy “additional resources” to support Israel.
For Karl Haeling and many analysts, the main factor in the drop in interest rates was above all the comments of several members of the American Federal Reserve (Fed).
“Yesterday, we had Fed Vice President Philip Jefferson and Dallas Branch President Lorie Logan, who both felt that there was less need to raise rates because the rise in yields on bonds of the Treasury acts as an interest rate hike,” Haeling explained.
“So we now recognize that financial conditions have tightened, which will slow down the economy and inflation,” he concluded.
The President of the Atlanta Fed, Raphael Bostic also said on Tuesday that there was “no longer any need to increase interest rates”, believing that monetary policy was currently sufficiently restrictive and had not finished show its effects.
On the stock market, almost all sectors of the S
Only the energy sector, which had risen sharply the day before amid fears of the consequences on the oil market of the attack by the Islamist movement Hamas against Israel, took a break (-0.02%).
On the market, Pepsico, which inaugurated the launch of the quarterly corporate results season, gained 1.88%.
The distributor of soft drinks, snacks and cereals raised its outlook for full-year results after a third quarter that was better than expected.
The group raked in $23.45 billion in revenue in the third quarter, compared to $21.97 billion a year earlier. Net profit stood at $3.10 billion, compared to $2.70 billion a year before. For the full year, earnings per share are expected to rise 13% instead of the 12% forecast so far.
Following the momentum that hit Pepsico’s stock, Coca-Cola gained 2.19%.
Among the day’s performances, Boeing, heavyweight of the Dow Jones, gained 2.67%, in distribution Walmart advanced by 1.13% and Target by 3.66%.
After their sharp rise on Monday in the wake of Hamas’ surprise attack on Israel, the stocks of defense groups have declined slightly, such as Northrop Grumman (-1.68%) or Lockeed Martin (-0.33%). .
The market was also awaiting the announcement of the pricing of the shares of Birkenstock, the German sandal manufacturer which is due to debut on the New York Stock Exchange this week.
The share price is expected to be between $44 and $49, which at the high end would represent a valuation of up to $9.2 billion, according to an SEC filing.
The Toronto Stock Exchange closed Tuesday with a gain of more than 250 points thanks to widespread strength fueled by the energy sector, while the major American indices also advanced.
The composite index S
On the currency market, the Canadian dollar traded at an average rate of 73.58 US cents, up from 73.08 US cents on Friday.
On the New York Mercantile Exchange, the price of crude oil fell 41 US cents to US$85.97 per barrel, while that of natural gas gained less than 1 US cent to US$3.38 per million of BTUs.
Gold prices rose US$11.00 to US$1,875.30 per ounce and copper prices fell US$1 cent to US$3.63 per pound.
