The New York Stock Exchange moved in disorganized order on Wednesday shortly after the opening, lacking stimulation while the indices remained close to record levels, the day promising to be poor in important news.
Around 4:00 p.m., the Dow Jones gained 0.37%, the Nasdaq index crumbled by 0.14% and the broader S&P 500 index nibbled 0.09%.
“There is a lack of conviction,” noted Karl Haeling of LBBW. The market is consolidating, there is no doubt about it.”
The yield on 10-year US government bonds rose to 4.04% on Wednesday, compared to 4.01% the day before, close to its two-month highs.
Patrick O’Hare, of Briefing.com, thus sees a series of factors which encourage the market to adopt a wait-and-see posture. He mentions, among them, the prospect of an attack by Israel against Iran and the publication, Thursday and Friday, of American inflation indicators.
“There is also uncertainty regarding the American presidential election”, which promises to be very close, adds Karl Haeling, recalling that “the month of October is traditionally a good month for stocks, except in a year of election”.
The New York market will follow the publication, at the beginning of the afternoon, of the minutes of the last meeting of the Fed’s monetary policy committee.
Waiting for “Milton”
Florida is preparing for the passage of Hurricane “Milton”, classified as category 4, on a scale of 5. The meteorological phenomenon, which currently causes winds of up to 250 km/h, is expected to reach the region of Tampa at the end of the day. Several companies whose activity will be or is already affected were folding, like Disney (-0.48%), which closed its Orlando park.
Oil companies were also in the red, like ExxonMobil (-0.51%) and ConocoPhillips (-0.78%) while, according to Patrick De Haan, of the specialist site GasBuddy, some 22% of stations- Florida service were out of gas Wednesday morning. For several analysts, “Milton” should disrupt economic activity in the region and limit travel, and therefore fuel demand.
Alphabet and Boeing struggling
On the stock market, the specter of a possible dismantling penalized Google and Alphabet (-2.02%). The Ministry of Justice mentioned on Tuesday evening a possible forced split of the group in a document sent to the federal judge responsible for defining the sentence which will be imposed on Google as part of its conviction for anti-competitive practices linked to its search engine.
The multiple legal proceedings targeting Alphabet and its subsidiary are increasingly handicapping the share price, which has plunged 16% since its peak at the beginning of July.
Boeing (-2.32%) was going through a new zone of turbulence after indicating, Tuesday evening, that it was suspending negotiations with the mechanics union IAM and withdrawing its last offer made to the organization. Discussions are therefore at an impasse and the strike, which began on September 13, continues on several major sites of the aircraft manufacturer.
WeightWatchers jumped (+20.62%) after the group specializing in diets announced that it had added to its offering an anti-obesity treatment from the GLP-1 family, which includes the now famous Wegovy from Novo Nordisk.
Cruise lines benefited from a rating from analysts at Citi, who say they are confident in the sector’s growth prospects. The major players in pleasure boating Carnival Corporation (+4.80%), Norwegian Cruise Line (+7.88%) and Royal Caribbean (+3.32%) were at the party.
Just like Tuesday, Chinese stocks listed on Wall Street were at half mast, the market digesting the disappointment linked to the lack of concrete recovery measures in China.
The large Chinese technology groups NetEase (-6.66%) and Baidu (-2.65%) were thus taking on water. (AWP)
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