The development of producer prices makes investors anxious. Their strong rise is causing concern as the next Federal Reserve decision is imminent. Meanwhile, the crypto industry is enjoying great popularity.
A stronger-than-expected rise in producer prices has caused nervousness on Wall Street. The Dow Jones Index of Standard Values and the broader S
According to the Department of Labor, producer prices rose by six percent in January compared to the same month last year. Economists had only expected an increase of 5.4 percent. From December to January, prices rose by 0.7 percent, almost twice as much as expected. The data provide early signals for consumer price developments. These are in turn an important indicator for the interest rate decisions of the US Federal Reserve.
A stronger-than-expected increase is fueling investors' fears of interest rates. Concerns were further fueled by statements from a senior Fed official. If the situation requires it, the central bank can also move "faster," said Cleveland Fed District Chair Loretta Mester. This could be the case, for example, if inflation turns out to be higher than expected in future months. As a result, the US growth stocks Amazon, Microsoft and Facebook parent Meta, which are particularly dependent on interest rate policy, lost between 2.6 and 2.98 percent.
Meanwhile, investors grabbed bitcoin. The cryptocurrency rose as much as 1.56 percent to $24,550, hitting its highest level since June. This speaks for a continued risk appetite of the investors, said Timoenden from Emden Research. According to analysts, the entry of established investors such as Citadel Securities into Silvergate also boosted the industry.
In terms of individual values, Crocs shares rose by up to 4.4 percent. The rubber shoe manufacturer exceeded analysts' forecasts with its earnings expectation. Meanwhile, the extension of a production and delivery stop for the electric model “F-150 Lightning” hit the carmaker Ford. The titles lost 0.19 percent. However, the losses were limited in the further course of trading. In addition, investors reacted with shock to Beijing's decision to classify Raytheon and Lockheed Martin as so-called "unreliable companies". The US arms companies lost 0.49 and 1.9 percent.
The Chinese Ministry of Commerce said it had sanctioned the two companies for selling arms to Taiwan. Among other things, they would be excluded from all imports and exports to and from China, executives would not be allowed to enter the country, residence permits for employees would be revoked and fines would be due. Experts see the decision as an escalation in the dispute over a suspected Chinese espionage balloon.