The New York Stock Exchange ended without a clear direction on Friday, unfavorable information for Nvidia counterbalancing good news regarding inflation.
The Dow Jones (+0.33%) recorded a new closing record, while the Nasdaq index fell by 0.39% and the broader S&P 500 index by 0.13%.
The major New York indices moved together in the green for a long time, before the Nasdaq turned around and took the S&P 500 with it.
This turnaround is due, according to Angelo Kourkafas of Edward Jones, to information from the Bloomberg agency according to which Chinese authorities are seeking to dissuade local companies from buying chips designed by the American giant Nvidia.
The government thus intends to stimulate the Chinese semiconductor industry and reposition it in the race for artificial intelligence (AI).
Besides Nvidia (-2.13%), the big American names in the sector also suffered, notably Micron (-2.17%) and Marvell Technologies (-3.35%).
The Nasdaq was also undermined by another member of its top 10, the semi-wholesale supermarket chain Costco (-2.71%).
Investors punished lower-than-expected revenue, even as net profit beat analysts’ projections.
Chief Financial Officer Gary Millerchip said consumers were shifting more toward lower prices in food.
The decline of several Nasdaq stars more than compensated for the good reception given by the New York Stock Exchange to the day’s indicators.
The PCE report highlighted a slowdown in the consumer price index in the United States, falling to 2.2% year-on-year in August compared to 2.5% the previous month.
At the same time, household spending increased by only 0.2% over one month, the lowest rate since January.
“Inflation is no longer the central subject of the PCE report for the Fed (American central bank),” explained Jamie Cox, of Harris Financial Group, “it is consumption and the health of the economy.”
“The Fed was right to lower its rate by half a point (during its last meeting),” continued the analyst, for whom “this data suggests that a further reduction of half a point is probable in November.”
The bond market reacted in this direction. The yield on 2-year US government bonds rose to 3.56% compared to 3.63% the day before at closing.
The New York market was also initially attracted by the recovery in the consumer confidence index, according to the monthly survey by the University of Michigan, at its highest level in five months.
With the Nasdaq at half mast, investors shifted to neglected stocks.
The energy sector was thus sought after, like ExxonMobil (+2.68%) and Chevron (+2.46%).
“Investors are opening their horizons (…) and daring to turn to more cyclical values”, that is to say theoretically more sensitive to the economic situation, according to Angelo Kourkafas.
Elsewhere on the stock market, Boeing advanced (+1.13%) while management and the mechanics union (IAM) must resume their negotiations on Friday to try to agree on a new social agreement, which would end the strike.
The hotel and casino group Wynn Resorts jumped (+7.24%) after the publication of a positive note from Morgan Stanley, which believes in the group’s potential in the United Arab Emirates and Macau.
After the series of announcements from Beijing intended to revive the economy and financial markets, Chinese stocks listed in New York are still progressing significantly. Among them, the technology company NetEase (+2.69%), notably a video game publisher, or the search engine giant Baidu (+2.54%).
Nasdaq
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