NEW YORK (awp international) – The US stock market continued the recovery that started in late trading on Friday with a lot of momentum. Market observers currently think it is conceivable that the US Federal Reserve could take its foot off the gas a bit on its rapid rate hike course if the economy slides into recession and inflation cools down a bit.
The Dow Jones Industrial rose 2.16 percent to 31,338.53 points with two hours to go. At 31,370 points, it had reached a high for two weeks. At the end of May there was a weekly plus for the last time, but now the leading US index is heading for an almost five percent weekly gain. The market-wide S&P 500 rose 2.39 percent to 3886.38 points on Friday.
The technology-heavy Nasdaq 100 also recovered significantly on Friday by 2.38 percent to 11,976.31 points, at times returning above the 12,000 mark. It’s also at its highest level in two weeks and is up as much as 6.3 percent so far this week.
Current economic data was considered to be conducive to the recovery on the US stock exchanges. US consumer sentiment fell to a record low in June. However, the market said their inflation expectations had come back from the last reported 14-year high. This could alleviate some of the pressure on monetary authorities at the moment. According to a market observer, investors are gradually starting to price out further rate hikes after December.
On the company side, the logistics company Fedex provided a topic of conversation with a surprisingly good business outlook. This sent shares jumping 6.7 percent to their highest level since February. Even if supply chain problems and higher costs have been troubling the industry recently, the group generated significantly more sales in the most recent quarter. Operating profit also increased.
In general, some sectors that had been hit hard in June because of economic concerns were able to recover strongly. This drove investors back into Dow papers such as those of the software group Salesforce or the aircraft manufacturer Boeing with increases of six and five percent respectively.
However, the leading US industry ranking was the banking sector, with increases of between 5.2 and 7.4 percent for the industry leaders Morgan Stanley, Goldman Sachs and Wells Fargo. It helped here that the largest financial institutions in the USA, according to the Fed, have crisis-proof capital resources. All 34 big banks passed the financial regulators’ annual stress test.
Travel stocks, including airlines and cruise lines, also rallied. The papers of the airlines United, Southwest, American and Delta rose between 4.6 and 6.3 percent, those of the cruise lines Carnival and Royal Caribbean even by up to 14 percent. Linked to the industry, listings for accommodation broker Airbnb rose 7.5 percent.
With a price jump of 28 percent, the Zendesk share caused a stir. According to circles, the company could be about to be taken over by a group of financial investors led by Hellman & Friedman and Permira
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