New York (AFP) – The New York Stock Exchange ended Monday slightly in the green, taking a breather after posting its best week of the year.
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The Dow Jones index gained 0.10% to 34,095.86 points, the tech-heavy Nasdaq advanced 0.30% to 13,518.78 points, and the broader S&P 500 index rose 0.18% to 4,365.98 points.
“Last week was the best of the year for the stock market. It is perfectly normal and healthy to see the market take a break to digest last week’s sharp rise,” said Adam Sarhan of 50 Park Investments to AFP.
“We are in a situation where the market slows down to consolidate the recent movements and awaits a new catalyst to continue the momentum. This could be the statements of a Fed official, Jerome Powell (the central bank’s president), or corporate earnings,” added the analyst.
This week, while the calendar is light in terms of indicators, several members of the US Federal Reserve are set to speak, including its president, Jerome Powell, on Thursday during a debate at the IMF.
A final series of corporate earnings is also expected, including those from entertainment specialists Disney (-1.20% at closing), Wynn Resorts (+2.57%), MGM Resorts (+0.33%), Warner Bros Discovery (-2.72%), as well as Uber (+0.84%), Lyft (-1.22%), and Roblox (-2.97%).
According to JPMorgan analysts, “the decline in bond yields and the accommodative decisions of central banks are perceived by the markets as a positive short-term factor.”
But, the analysts added in a note, “we believe that stocks will soon reconsider the profit/risk ratio in a context where the Fed will keep rates high for longer, where profit expectations are too optimistic, and where margins are at risk.”
The yield on ten-year Treasury bonds stood at 4.65% compared to 4.57% on Wednesday and 5% two weeks ago.
This week, the US Treasury will launch new debt offerings, including $40 billion in ten-year notes on Wednesday and $24 billion in thirty-year notes on Thursday.
“That’s a lot of debt to digest,” commented Patrick O’Hare.
On the indicators side, it’s a quiet week with only the first estimate of consumer confidence for November, published by the University of Michigan on Wednesday.
On the market, automakers declined by over 2%, such as Ford and General Motors, while Stellantis dropped 2.76%.
Regional banks fared poorly as credit conditions tightened and loan demand slowed in all sectors, according to the latest monthly survey by the Fed of credit officers. Comerica dropped 2.52%, Zions Bancorportation -1.67%, and Western Alliance -2.71%.
Microprocessor manufacturer Nvidia gained 1.66% at $457, even though its quarterly results are not expected until November 21.
The volatile stock of the Bumble app, which empowers women to make the first move, lost 4.39% after the announced departure of CEO Whitney Wolfe Herd. She is replaced in this position by Lidiane Jones, who comes from the professional collaboration app Slack, where she was CEO.
© 2023 AFP
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