NEW YORK (dpa-AFX) – The stabilization of the US stock exchanges continued on Tuesday after a brief weakness. The leading index Dow Jones Industrial (Dow Jones 30 Industrial) closed 1.06 percent firmer at 32,155.40 points. The market-wide S&P 500 ultimately rose by 1.68 percent to 3920.56 points. The day before, both indices had significantly reduced their losses by the close of trading. The tech-heavy NASDAQ 100, which closed higher on Monday, rose another 2.32 percent to 12,199.79 points.
In the banking sector, the securities of some regional banks, which have recently come under heavy pressure, recovered significantly. Increasing hopes that the US Federal Reserve would slow down interest rate hikes proved to be a course support for both banks and the market. Voices are growing that monetary authorities could pause the rate hike cycle at next week’s meeting. The analysts at the Japanese financial group Nomura are even expecting a key rate cut of 0.25 percentage points.
At least the latest inflation data from the United States has not fueled fears of tighter inflation monetary policy: In February, consumer prices rose by just 6 percent year-on-year, as expected, the lowest increase since September 2021. As a result, the Fed no longer needs to speed up the rate hikes, commented economist Thomas Gitzel from VP Bank. The Fed will raise interest rates by 0.25 percentage points in March. “It’s over after that,” he expects.
Shares in First Republic Bank rebounded 27 percent on Tuesday, while Western Alliance Bancorp (Western Alliance Bancorporation) and PacWest Bancorp were up a good 14 percent and about a third, respectively. The titles of supra-regional industry giants such as Dow members JPMorgan (JPMorgan ChaseCo) and Goldman Sachs as well as Bank of America, Citigroup and Wells Fargo (Wells FargoCo), represented in the S&P 500, were able to increase. The collapse of the Silicon Valley Bank last week was the largest US bank collapse since the 2008 financial crisis.
At Meta (Meta Platforms (ex Facebook)), the shareholders were happy about a price increase of 7.3 percent and the top spot in the Nasdaq 100 after the Facebook parent company announced that it would cut another 10,000 jobs. In addition, around 5,000 vacancies should no longer be filled, like the company founder and boss Mark Zuckerberg communicated.
Shares in chemicals retailer Univar Solutions jumped 12 percent to $34.91 thanks to a takeover bid by Apollo Global (Apollo Global Management). The financial investor wants to put $36.15 per Univar share on the table, which values the company at $8.1 billion including assumed debt. The Apollo shareholders apparently appreciate the deal, as the increase of almost two and a half percent in Apollo shares showed.
The fact that a court ruling classified the drivers working for the driving service providers Uber and Lyft as independent contractors caused their papers to increase by five and 0.6 percent, respectively.
Conversely, United Airlines shares fell nearly 5.5 percent after the airline’s disappointing quarterly outlook.
Amgen’s shares were in the strong market with minus 1.1 percent Dow tail. Here the lawsuit of a pension fund charged to the BiotechThe company accuses investors of not informing investors too late about possible back taxes and penalties totaling more than ten billion dollars.
At the end of the day, Pfizer only posted a slight plus after the rating agency Moody’s lowered the outlook for the pharmaceutical company’s creditworthiness to negative. At the beginning of the week it was announced that Pfizer was acquiring cancer specialist Seagen for $43 billion.
The euro was almost flat at $1.0735. The European Central Bank (ECB) had set the reference rate at 1.0737 (Monday: 1.0706) dollars and the dollar thus cost 0.9314 (0.9341) euros.
US Treasury bonds paid tribute to their recent price rally: the futures contract for ten-year bonds (T-Note future) fell by 0.95 percent to 113.56 points, which in turn caused the yield on ten-year Treasuries to rise to 3.68 percent./gl /jha/
— By Gerold Löhle, dpa-AFX
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