New trading week – and it starts on Wall Street with premiums. However, airline stocks in particular are under pressure. Investment legend Buffett is one reason for that. In contrast, online game providers are particularly in demand.
The US stock markets rose at the start of the week. The Dow Jones-Index of the standard values closed 0.1 percent firmer at 23,749 points, almost to a daily high after it had lost large parts of the trade and had in the meantime listed around 400 positions lower. The broader S&P 500 rose 0.3 percent to 2,839 points Nasdaq composite by 1.2 percent to 8710 points. The Dax on the other hand, had closed much lower.
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The Dow only turned positive in the last half hour of trading. Previously, the US-China dispute over the origin of the corona virus and investor Warren Buffett’s critical words about the aviation industry had weighed on prices. US President Donald Trump blames China for the pandemic and threatened the People’s Republic in connection with new tariffs. In late trading, however, price gains of large tech companies lifted the indices up. Apple, Amazon and Facebook won more than one percent, Microsoft around two percent.
Online game providers asked
Shares in airlines such as delta, American, Southwest and United with discounts of up to 14.5 percent. However, the discounts reduced in late trading. Investor Warren Buffett’s Berkshire Hathaway holding announced at the weekend that it would divest itself of its holdings. The industry was hit hard by the virus pandemic. At the end of 2019, Berkshire held about ten percent each of the four airlines.
The meat group’s shares fell by a good eight percent Tyson Foods. The company announced that it would temporarily close slaughterhouses if necessary. Because restaurants are closed in the fight against the pandemic, meat demand is likely to decrease in the second half of the year. Most recently there have been outbreaks of Covid-19 lung disease among workers in slaughterhouses. Trump had described the industry as necessary, which is allowed to continue working during the pandemic.
The winners included the online game providers Activision Blizzard and Electronic Artswhose shares rose about three percent each. Credit Suisse analysts had previously set price targets for both companies. The virus crisis should not only lead to customers downloading more games, but also to spend more money on in-game purchases.
In the current reporting season, just over half of the companies from the S&P 500 have submitted figures so far. On this basis, analysts assume that the profits of these companies in the first quarter will probably be on average 12.5 percent lower than in the same period of the previous year. For the second quarter, they expect a 39 percent slump.
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