NEW YORK (Dow Jones) – A recovery rally gave Wall Street a hefty hit on Thursday. Weak weekly US job market data and ongoing concerns about a slower-than-expected economic recovery had initially weighed on the economy. But over the course of the year, the indices caught up and turned positive. Investors have weighed weak economic data and renewed tensions between the US and China against increased global easing, it said.
The upward movement was led by the financial sector, which gained 2.6 percent. The sector was hit because investors were concerned about economic developments and the possibility of negative interest rates, which would burden the business model of the banks, it said. Energy stocks were also sought after with the sharp rise in oil prices – the sector gained 0.9 percent.
The Dow Jones index rose 1.6 percent to 23,625 points. In the daily low it had initially dropped to 22,790 points. The S&P 500 rose 1.2 percent to 2,853 points. The Nasdaq composite climbed 0.9 percent to 8,944 points. The 1,483 (Wednesday: 326) course winners on the NYSE were confronted with 1,484 (2,648) losers. 54 (38) shares closed unchanged.
Weak US labor market data is being pushed out
After yesterday’s US Federal Reserve President Jerome Powell scared the markets with critical statements regarding an early economic recovery, the weak labor market data reflected this. At nearly 3 million, more Americans have submitted initial jobless claims than forecast. The number has decreased compared to the previous week, which was expected. But in the past few weeks the total of those who lost their jobs due to the corona pandemic has increased to around 36 million. The situation on the job market is important for American consumer sentiment. The US economy lives primarily from domestic consumption.
“The pace of recovery is likely to be disappointing because the lifting of the blocking measures will not bring the economy to pre-crisis levels,” said portfolio manager Hani Redha of PineBridge Investments. Policy measures prevented depression, but are unlikely to prevent a deep recession. Recently, the more optimistic scenario of a V-shaped, i.e. fast and strong recovery, has been repeatedly played on the markets.
Oil prices with rally – gold price at three-week high
Oil prices rose to their highest level in six weeks. Participants referred to the massive production cuts of the producing countries and companies as reasons. In addition, with the pandemic restrictions easing, demand is expected to gradually increase. The price of the US variety WTI rose by 9.1 percent to $ 27.60 a barrel, Brent gained 6.5 percent to $ 31.09.
The gold price peaked at $ 1,736, a three-week high. The troy ounce eventually gained 1.0 percent to $ 1,732. The current economic worries also played into the hands of the precious metal, it was said. There is also a debate in the United States about possible negative key interest rates. The day before, Federal Reserve chief Powell said that this was not due, but the US president Donald Trump repeated this request on Thursday. Negative key interest rates would gold give an additional boost because gold does not generate any interest income and would therefore eliminate competing investments.
The dollar showed slight gains against the major currencies. Market participants spoke of continued slight risk aversion, which benefits the currency. The euro was trading at $ 1.0801 in late US trade, after a daily high of $ 1.0824. The dollar index rose 0.1 percent.
Despite the recovery in the stock market, US bonds remained in demand. However, the profits were limited significantly. The ten-year yield decreased by 1.9 basis points to 0.63 percent with rising prices.
Bank stocks with recovery – Cisco searched for numbers
JP Morgan securities gained 4.2 percent in the banking sector and Goldman Sachs rose 1.5 percent. American Express stocks rose 7.4 percent. In oil stocks, Chevron stocks rose 1.5 percent and Exxon Mobil increased 1.0 percent.
Cisco Systems’ price rose 4.5 percent after the network equipment supplier slightly exceeded market expectations in its third business quarter. However, sales decreased 8 percent to $ 12 billion. Cisco reported $ 2.8 billion in net income. Cisco’s fourth-quarter projections were roughly in line with analysts’ estimates.
Delta Airlines shares lost 0.2 percent. The airline plans to phase out its 18 777 aircraft by the end of the year. The airline has to cut costs because the corona pandemic has virtually brought global travel to a standstill. As soon as international demand picks up again, Delta will rely more on Airbus’ more fuel-efficient A330 and A350. Further early withdrawals are not excluded. The Boeing share gained 0.8 percent after initial losses.
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INDEX last +/-% absolute +/-% YTD
DJIA 23,625.34 1.62 377.37 -17.22
S & P-500 2,852.50 1.15 32.50 -11.71
Nasdaq Comp. 8,943.72 0.91 80.55 -0.32
Nasdaq-100 9,094.43 1.05 94.35 4.14
US bonds
Maturity yield bp to vt yield vt +/- bp ytd
2 years 0.14 -2.0 0.16 -106.5
5 years 0.29 -2.4 0.31 -163.3
7 years 0.49 -0.7 0.49 -176.1
10 years 0.63 -1.9 0.65 -181.6
30 years 1.30 -4.4 1.35 -176.5
CURRENCIES last +/-% Thu, 8:33 a.m. Wed, 5:28 p.m.% YTD
EUR / USD 1.0801 -0.16% 1.0806 1.0840 -3.7%
EUR / JPY 115.93 + 0.10% 115.46 115.94 -4.9%
EUR / CHF 1.0515 -0.04% 1.0516 1.0518 -3.2%
EUR / GBP 0.8834 -0.09% 0.8858 0.8864 + 4.4%
USD / JPY 107.33 + 0.25% 106.85 106.97 -1.3%
GBP / USD 1.2228 -0.05% 1.2198 1.2228 -7.7%
USD / CNH (offshore) 7.1099 -0.02% 7.1102 7.1062 + 2.1%
Bitcoin
BTC / USD 9,661.51 + 3.23% 9,427.76 9,128.01 + 34.0%
ROHÖL last VT-Settl. +/-% +/- USD% YTD
WTI / Nymex 27.60 25.29 + 9.1% 2.31 -53.6%
Brent / ICE 31.09 29.19 + 6.5% 1.90 -51.0%
METALLE last day before +/-% +/- USD% YTD
Gold (spot) 1,732.43 1,715.55 + 1.0% +16.88 + 14.2%
Silver (spot) 15.85 15.65 + 1.3% +0.20 -11.2%
Platinum (spot) 773.20 760.00 + 1.7% +13.20 -19.9%
Copper future 2.35 2.35 + 0.1% +0.00 -16.3%
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DJG / DJN / ros
(END) Dow Jones Newswires
May 14, 2020 16:19 ET (20:19 GMT)
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