Again and again the interest rate policy. On the US stock exchanges, speculation about the next rate hike by the Fed continues. But that is no longer enough fuel. Economic data fizzle out and so some traders cash in.
The US stock markets ended the week with slight losses. The interest rate policy of the US central bank continued to be the focus. The Dow Jones index closed 0.1 percent lower at 33,554 points. The broader S
San Francisco Federal Reserve Chair Mary Daly sees interest rates continuing to rise. The Fed's interest rate may have to rise above 5 percent to fight inflation. An interest rate between 4.75 percent and 5.25 percent is "a reasonable level to think about," she told CNBC. Daly added that the central bank plans to keep interest rates high until there is some progress on inflation.
US retail data did not elicit a major reaction. These rose by 1.3 percent in October, which is slightly more than expected. Meanwhile, import prices fell 0.2 percent in October, less than forecast. The data should not trigger a market reassessment of the likely US interest rate path, it said.
Industrial production fell 0.1 percent for the month in October, while analysts had expected a similar increase. In addition, the previous month was revised downwards. Inventories rose 0.4 percent in September, slightly less than expected.
The dollar weakened somewhat on the foreign exchange market. The dollar index lost 0.2 percent. The Dollar was further weighed down by the prospect of a slower pace of upcoming rate hikes by the US Federal Reserve.
Oil prices showed up with levies. Brent crude fell 1.2 percent and WTI fell 1.9 percent. "OPEC has lowered its forecasts for demand growth in 2022 and 2023 by 100,000 barrels per day in its monthly report, primarily due to lower Chinese demand," said Stephen Innes, managing partner at SPI Asset Management. This is despite the possibility that China could soon ease further the corona restrictions. Crude oil inventories in the US, meanwhile, fell more than expected last week.
Yields fell on the bond market, thereby expanding the losses of the previous day. The 10-year yield fell 9.0 basis points to 3.68 percent. The gold price was a little lighter after the previous day's gains. The price of the troy ounce was 0.3 percent lower.
Shares in US retailer Target fell 13.1 percent after the company made significantly less than expected earnings in the third quarter and forecast a decline in sales for the current quarter.
The semiconductor manufacturer Micron (minus 6.7 percent) is significantly reducing its DRAM and NAND wafer production. The group assumes that production in the current quarter will be around 20 percent lower than in the previous quarter. As justification, Micron referred to the current market environment, which is characterized by declining demand, and announced that it intends to further reduce the cost of capital.
Amazon (down 1.8 percent) is laying off employees in administration. According to the company, it wants to save costs. The group didn't provide a number, but a source said around 10,000 jobs could be cut, including in the commercial, technical equipment and human resources businesses.
