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US Stock Exchanges Set to Open Near Record Levels with Moderate Losses | Economic Data and Fed Speeches In Focus

NEW YORK (dpa-AFX) – The US stock exchanges are likely to start trading on Wednesday near record levels with moderate losses. After reaching records last week, the indices are finding it difficult to continue the rally. Finally, important economic data is on the agenda on Thursday with the inflation data for January and on Friday with the ISM indicator from industry. In addition, several representatives of the US Federal Reserve will give speeches this Wednesday.

Around an hour before trading began, broker IG estimated the Dow Jones Industrial 0.23 percent lower to 38,883 points. This would mean that the best-known Wall Street index would extend its losses from the previous day. According to IG, the Nasdaq 100, which is predominantly stocked with technology stocks, is expected to start with minus 0.33 percent at 17,911 points and thus give up its gains from Tuesday.

The second estimate for the gross domestic product of the USA did not increase as significantly as expected in the fourth quarter on an annualized basis. So that didn’t put a damper on the interest rate cut fantasies. The mood remains optimistic, even if the high expectations of rapid and sharp interest rate cuts by the Fed this year have now been scaled back. The aim is now for a total reduction of 0.75 percentage points, with a first step not before May or June. This is generally considered realistic.

Market participants are nevertheless relieved that it is no longer a question of if, but when the Fed will cut interest rates in the face of falling inflation. This in turn increases the attractiveness of stocks compared to bonds.

Investors continue to focus on quarterly reports and outlooks from well-known US companies. The online auction house eBay had impressed the day before with its figures and statements for the first quarter and the year as a whole. Before the trading session, the shares rose by a little more than 5 percent. The situation is similar with First Solar, whose shares rose by almost 7 percent before the trading session. There is little sign of a crisis at the solar module manufacturer. Although it missed the market’s sales expectations, it was convincing with its profits and outlook.

After-hours this Wednesday, Salesforce will attract attention. According to RBC analyst Rishi Jaluria, the software company is likely to present solid figures. The debate about whether double-digit or single-digit growth rates can be maintained is likely to have ended for the time being after the good third quarter, he wrote. The overall economic environment can hardly be called ideal and competitors like Hubspot are better positioned for the generative artificial intelligence (AI) business. Before the trading session, Salesforce’s share price increased slightly.

Shares of Applied Materials fell nearly 3 percent at the same time. US government authorities made renewed inquiries about the semiconductor supplier’s supplies to Chinese customers.

Among the smaller stocks, Beyond Meat jumped by almost 60 percent after the manufacturer of vegan meat substitute products exceeded market expectations despite a decline in business in the past quarter.

Stocks related to cryptocurrencies are also likely to continue to rise after the price of Bitcoin rose even further and surpassed the $60,000 mark. MicroStrategy and Marathon Digital each gained 7 percent premarket, Cleanspark and Coinbase jumped by just over 5 percent each and Riot Platforms by almost 4 percent./ck/mis

2024-02-28 13:52:00
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