In September, producer prices in the USA rose significantly more than expected. Investors on Wall Street therefore fear further major rate hikes by the US Federal Reserve. The minutes of the last interest rate meeting indicate exactly that. Nevertheless, Pepsi and Coca-Cola can score.
After the recent slide, investors are feeling their way back to Wall Street. However, the prospect of a sustained rate hike by the US Federal Reserve significantly dampened their buying mood. The US blue chip index Dow Jones closed 0.10 percentage points lower at 29,210 points on Wednesday. The broad S
The latest bad news came from US producer prices. In September they rose by 0.4 percent compared to the previous month, twice as much as expected. In addition, inflation fell less sharply than had been hoped compared to the same period of the previous year. Inflation is stubborn and speculation about an easing is premature, said Joe Saluzzi, manager at brokerage house Themis. Therefore, the Fed will continue to raise interest rates in large steps. A quick end to this phase is not in sight. Investors are certain that the Fed will raise interest rates by 0.75 percentage points for the fourth time in a row at the beginning of November.
This is also indicated by the published Fed minutes of the interest rate meeting in September. At the meeting, the American monetary authorities agreed that they must raise the key interest rate to a level that is more restrictive - that is, to rein in the economy more. After that, it is important to maintain this level for some time. Several panellists felt it was important to "adjust" the scope of further monetary tightening to mitigate the risk of a significant negative impact on the economic outlook.
The Federal Reserve has been ratcheting up interest rates in leaps and bounds for months to keep inflation under control. The inflation rate in August was 8.3 percent, well above the central bank's target of 2.0 percent. Analysts surveyed expect a value of 8.1 percent for September.
In September, the Fed raised the key interest rate unusually sharply by three-quarters of a percentage point for the third time in a row. It is currently in a range of 3.00 to 3.25 percent. At their September meeting, the monetary authorities signaled that they could raise it to an average level of 4.25 to 4.50 percent by the end of the year. According to their projections, the key interest rate should end up at 4.50 to 4.75 percent at the end of 2023.
This outlook fuels fears of a recession and falling crude oil demand. As a result, the US variety WTI fell by 2.8 percent to $86.86 per barrel (159 liters). Aluminum, on the other hand, rose in price by up to 7.3 percent to $2,400 a ton.
According to Bloomberg, the United States is considering a ban on Russian aluminum as part of sanctions over the Ukraine war. A direct embargo, a de facto import stop through high punitive tariffs and sanctions against the aluminum producer Rusal, is under discussion. This supplies six percent of global demand. The prospect of a longer-term price rally and the disappearance of a major competitor gave Alcoa a boost. Shares in the US aluminum smelter rose 5.3 percent.
Pepsi was one of the winners on the US stock market with a price increase of a good four percent. Thanks to robust demand and price increases, the provider of beverages and snacks is aiming for an increase in sales of twelve percent instead of the previous ten percent. The profit should also be higher. Pepsi also exceeded the increased expectations with the quarterly result, praised analyst Kevin Grundy from the investment bank Jefferies. On this basis, the targets for 2022 appeared conservative. In the slipstream, the papers of rival Coca-Cola rose 1.2 percent.
Moderna was also up, up 8.3 percent. The biotech company wants to work with Merck
Uber and Lyft each posted gains of 5.3 percent. Experts expect a year-long dispute over a new US law that makes it difficult for the two transport service providers and other companies such as delivery services to employ drivers as self-employed. The law could be defused or even completely prevented.
