Equities New York outlook: further recovery – investors question rate hike course | 06/24/22

NEW YORK (dpa-AFX) – On Friday, the US stock market is likely to continue the recovery course set in late trading the previous day. Market observers currently think it is conceivable that the US Federal Reserve (Fed) could take its foot off the gas a little on its rapid rate hike course if the economy slides into recession and inflation cools down a bit.

An hour before the start of trading, broker IG assessed the Dow Jones Industrial (Dow Jones 30 Industrial) with an increase of 0.78 percent to 30,916 points. After a very weak previous week marked by recession worries with a minus of almost five percent, the New York leading index picked up again this week. A weekly plus of 3.4 percent is currently emerging.

The tech-heavy NASDAQ 100 is expected to open 0.90 percent higher on Friday. The day before, it had increased even more than the standard values ​​​​and is currently heading for a positive weekly balance of 4.8 percent. Shares in technology groups that have to leverage large investments in growth usually react particularly sensitively to changes in interest rate expectations.

The shares of the logistics company FedEx increased by 2.7 percent before the market. The group generated significantly more sales in the most recent fiscal quarter and operating profit also increased. Fedex and competitors like UPS (United Parcel Service) and DHL benefited greatly from the boom in online orders during the pandemic. However, supply chain problems and higher labor and transport costs have bothered them recently. Nevertheless, Fedex gave a better business outlook than analysts had expected for the new financial year that had just begun.

According to the Federal Reserve (Fed), the largest financial institutions in the USA have crisis-proof capital resources. All 34 major banks passed the financial regulators’ annual stress test. With the endurance test, they want to ensure that lending to companies and households does not come to an abrupt halt in the event of a financial market collapse.

The US Federal Reserve’s stress tests are a consequence of the financial crisis of 2008. For many of the large banks, the annual test is crucial in order to be able to distribute money to investors in the form of dividends or share buybacks. From Monday they are allowed to publish their capital plans. In the pre-market business on Friday, some bank stocks such as those of Goldman Sachs, JPMorgan (JPMorgan ChaseCo) or Wells Fargo (Wells FargoCo) rose in line with the market.

Zendesk (Zendesk) surged nearly 50 percent in premarket trading. According to a person familiar with the matter, the software manufacturer is apparently about to be taken over by a group of financial investors led by Hellman & Friedman and Permira./ajx/nas

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