(CercleFinance.com) – The scenario is quite unexpected: Wall Street seemed well on its way to ending in the red but a spectacular rebound began around 9:35 p.m…. and the sellers, caught on the wrong foot, had to redeem themselves in a hurry.
This was especially seen during the last 10 minutes, which have become more and more crucial in recent months with the expiration of ‘daily’ options, especially during the last session of the week and the month of May. .
The S&P500 (+0.97%) gained a whopping +60 points in a straight line in 25 minutes, including +22 points in the last 10 minutes (in ‘panic rise’ mode)… and the ‘VIX’ plunged again -10.5% to 12.9.
Same scenario on the Nasdaq, off to a bad start around 6:30 p.m. with a decline of -1.7% towards 16,450, regained all lost ground, including 160 Points (+1%) in 30 minutes, with sustained purchases on Zscaler +8.5 %, Netapp +3.4%, Comcast +3%, Sirius +2.9%, Intel +2.2%.
This is one of the most dramatic trend reversals of the year.
As for the Dow Jones, it regained in one go the -1.5% lost the day before: thus, the best session of the year follows the worst, with the same ‘star’ as the day before.
Salesforce had fallen by -19.5%, the stock recovered +7.5%… but this was not enough to propel the Dow Jones 550 points higher, the ‘Dow’ also benefited from the rise in United Health + 3.05%, Boeing +2.8% Bank of America +3.5%, McDonald’s and Chevron +2.7%.
But if the Nasdaq was unable to finish in the green, it is also because of the heavy declines in MongoDB -23.5%, Dell -17.8%, Marvel -10.5%, SuperMicro -5.3% , Broadcom -2.6%, Lam research -1.9%, Amazon -1.6%, KLA -1.4%… and Nvidia rose from -2.5% to -0.8%.
To try to put forward a factual reason for a stock market movement that appears irrational, it is logical to mention the improvement in T-Bonds which are easing.
But they relax modestly (-5 Points on the ’10 year’ to 4.503% and the same on the ‘2 year’ towards 4.891%)… and the weekly results are not brilliant since the yields are tending from +4 to +5Base points.
In other words, the publication of the PCE price index – the most closely monitored by the Fed – was a non-event: it came out in line with expectations for the month of April.
The annual inflation rate remains stable compared to March, at 2.7% in raw data and at 2.8% in ‘core’ (or underlying, excluding energy and food).
The Department of Commerce, which publishes these figures, also indicates that American household spending increased by 0.2% in April compared to the previous month (+2.65%/1 year), while their income increased. of 0.3% (in line with expectations).
