(Photo: 123RF)
MARKET REVIEW. The New York Stock Exchange ended slightly higher on Monday, narrowly setting a new record for the S&P 500 and the Nasdaq, awaiting the big events of the week, namely American inflation and a monetary decision from the Fed .
Strength in the energy, technology and base metals sectors helped push Canada’s main stock index higher late in the morning.
Stock market indices at closing
In Toronto, the S&P/TSX advanced +62.76 points (+0.29%) to 22,069.76 points.
In New York, the S&P 500 increased by +13.80 points (+0.26%) to 5,360.79 points.
THE Nasdaq advanced +59.40 points (+0.35%) to 17,192.53 points.
THE DOW advanced +69.05 points (+0.18%) to 38,868.04 points.
THE loon remained in balance (-0.0022%) at US$0.7268.
THE oil rose +US$2.52 (+3.34%) to US$78.05.
L’gold ended up +US$1.90 (+0.08%) at US$2,326.90.
THE bitcoin decreased by -US$21.27 (-0.03%) to US$69,593.99.
Context
“The market reversed the trend and behaved rather well, considering the rise in bond rates” in the absence of macroeconomic data, commented Peter Cardillo of Spartan Capital while Wall Street had started in the red.
Two factors played a role, according to him, allowing stocks to recover. Oil prices soared by almost 3% per barrel of West Texas Intermediate, which supported stocks in the sector (+0.74%).
But it is above all technology that has given impetus to Wall Street in particular Meta (META, +1.96% to US$502.60), Microsoft (MSFT, +0.95% to US$427.87), and Amazon (AMZN, +1.50% to US$187.06).
The group Apple (AAPL), which had climbed sharply on Friday, lost 1.91% to US$193.12 even though it announced the launch of Apple Intelligence, a new system for optimizing the use of its devices, from iPhone to Mac, thanks to generative artificial intelligence (AI).
To do this, the Apple company has entered into a partnership with OpenAI, one of the masters of generative AI with ChatGPT.
Apple Intelligence will feature in the new version of the iOS 18 operating system, also unveiled Monday during the week-long developer conference.
Beyond these one-off announcements, investors have positioned themselves in relation to the macroeconomic announcements which will take place on Wednesday.
The market has no doubt that the Federal Reserve will leave rates unchanged at their highest level in more than twenty years. But the Fed must publish new forecasts and investors are watching for any indication of future rate cuts.
“The Fed meeting will be complicated by the morning publication of the CPI index. If inflation is low everything is fine. If not, their breakfast will be ruined,” commented Chris Low of FHN Financial as well.
Analysts forecast that consumer prices rose 0.1% in May to remain at 3.4% year over year, according to MarketWatch.
The market believes at 46.7% that a Fed rate cut could occur in September, according to calculations on CME Group futures products.
Bond rates, spurred on Friday by much stronger job creation than expected at 272,000 in May, remained on an upward slope.
Around 6 p.m., yields on ten-year Treasury bills stood at 4.46% compared to 4.43% on Friday.
After the European elections which saw a rise of the far right in France and Germany in particular and the surprise decision of French President Emmanuel Macron to call legislative elections, the euro took a nosedive.
It lost 0.36% against the dollar. The euro fell to 1.076 dollars per euro.
Elsewhere on the market, the action of the chip designer for AI Nvidia (NVDA) gained 0.75% to US$121.79, after its division by ten at the end of Friday’s session where it closed at US$1,198.40.
Its competitor in semiconductors, AMD fell 4.49% to US$160.34 after a rating downgrade by analysts at Morgan Stanley.
Laboratories Eli Lilly (LLY) climbed 1.88% to US$865.00 after taking a first regulatory step with the FDA health authorities towards the authorization of a new drug against Alzheimer’s disease.
The real estate investment fund KKR (KKR) soared 11.22% to US$108.95 while the cybersecurity specialist CrowdStrike (CRWD) gained 7.29% to US$374.57 and the site registration platform Godaddy (GDDY) rose 1.94% to US$142.04. The three stocks will enter the broader S&P 500 index on June 24.
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