The Fed is expected to raise rates further. Stockbrokers are therefore only hesitant to access them. Meanwhile, economic pessimism persists. It is particularly evident in the commodities market. The US crude oil type WTI has become drastically cheaper, while the dollar index has increased significantly.
After the recent slide in prices, investors are taking the opportunity to re-enter the US stock market. However, the uncertainty about the speed of the expected US interest rate hikes dampened the buying mood. The standard value index Dow Jones rose by 1.4 percent to 31,581.28 points. The broad S
In the forex market, the dollar index, which tracks rates against major currencies, hit 110.79 for the fourth time in five days, a 20-year high before profit-taking pushed it to 109.59. "I wouldn't be surprised if the Fed was worried about the currency's performance," said analyst David Madden of brokerage firm Equiti Capital.
The appreciation of the dollar could have a negative impact on exports. So far, stockbrokers are firmly expecting the US Federal Reserve to raise interest rates by 0.75 percentage points for the third time in a row at its meeting at the end of the month. Rising bond yields in tandem with higher interest rates have made this asset class a competitor for stocks, interjected portfolio manager Paul Nolte of wealth manager Kingsview. As long as this trend continues, Dow, S
Economic pessimists were in the majority among commodity investors. "The prospect of a recession in the western world is becoming a reality as runaway inflation and rising interest rates hurt consumption," warned analyst Stephen Brennock of brokerage house PVM Oil Associates. Disappointing economic data from China also weighed on the mood. "The decline in exports and imports demonstrates the vulnerability of the global economy and the scope of the corona shock," said analyst Danni Hewson from brokerage house AJ Bell. As a result, US crude oil WTI fell by more than five percent to around $82 a barrel (159 liters).
When it came to companies, Apple took the spotlight. Among other things, the electronics group presented its new iPhone 14. "But the big question is how many buyers it will find," said Naeem Aslam, chief market analyst at brokerage firm AvaTrade. "After all, everyone is grappling with the rising cost of living. Not many will want to shell out more than $1,000 while worrying about rising mortgage rates and utility bills." Apple shares barely moved, rising just under a percent to 155.96 points.
Investors boldly grabbed Coupa's stocks. They rose by almost 18 percent at the top, as strong as two and a half years ago. Analyst Matt VanVliet from brokerage house BTIG praised the company software provider's quarterly results across the board. However, the view was a bit disappointing.
