Will the US Federal Reserve raise interest rates again soon? Uncertainty is causing restraint in US markets. General Mills, on the other hand, is on the up. The food manufacturer is among the winners of the day.
The guesswork about the further monetary policy course of the US central bank does not give rise to a buying mood on Wall Street. The American share indices presented themselves changeable. The Dow Jones index of standard values gained 0.3 percent to 31,029.31 points. The tech-heavy Nasdaq was little changed at 11,177.89 points and the broad-based S
In view of the rising inflation, some Fed representatives had recently advocated further rapid interest rate hikes and downplayed fears that the economic engine would stall. With his statements at a central bank conference in Portugal, US Federal Reserve Chairman Jerome Powell again signaled that he wanted to fight inflation with all his might.
"The issue drives investors," said portfolio manager Robert Pavlik from the asset manager Dakota Wealth Management. "They're not taking it easy, that's for sure. Right now when you have these kinds of negative confluences coming together all at once, it keeps people on the sidelines, unwilling to step in and become buyers."
Investor expectations for aggressive rate hikes in the US bolstered the US dollar. The dollar index, which measures the world's leading currency in relation to other important currencies, rose half a percent to 105.03 points. The euro fell 0.6 percent to $1.0450.
Investors on the European bond markets grabbed after a surprisingly low June price increase in Germany. The inflation rate was 7.6 percent yoy, below the previous month and also below the 8.0 percent expected by analysts. "This is the hoped-for relaxation," said Thomas Altmann from the asset manager QC Partners. The yield on ten-year federal bonds fell by ten basis points to 1.53 percent. Earlier in the week, fears of inflation had pushed yields higher. The 10-year US Treasury yielded 3.113 percent from 3.207 percent on Tuesday.
The inflationary pressure and the deteriorating economy are getting the central banks into trouble. In the fight against inflation, the European Central Bank (ECB) intends to raise its key interest rate for the first time since 2011 and to do so again in September. In mid-June, the Fed raised key interest rates more sharply than it had since 1994 and is holding out the prospect of further rapid hikes. This increases the cost of borrowing for both consumers and businesses, which is likely to hurt consumption and investment. This, in turn, could add to the already weakening economy.
Among the biggest losers were shares in Bed, Bath
After a positive analyst assessment, Goldman Sachs rose by 1.7 percent. BofA Global Research upgraded the stocks to "Buy" from "Neutral". The bank is well positioned in a deteriorating global economy to outperform the industry average, it said.