The DOW JONES has already risen by 0.64% or 217 points to 34,197 points in the morning and is thus recovering from the initial declines. The S&P 500 is down 0.47% to 4,393 points and the NASDAQ 100 is up 0.36% to 13,678 points.
In yesterday’s Wednesday trading, the S&P 500 and Nasdaq Composite hit their highest levels since April 2022 after significant volatility over the past hour. The S&P 500 closed the session up 0.08%, ending its fifth straight positive session and its longest winning streak since November 2021.. The Nasdaq rose 0.39% while the Dow fell 0.68%.
Today, the market will continue to digest Fed Chair Jerome Powell’s intervention at last night’s press conference following the Federal Open Market Committee meeting. The Fed left rates unchanged in a range between 5.0% and 5.25%, as expected, but its chairman opened the door for further rate hikes in the coming meetings. As a matter of fact, Forecasts released with the rate decision seem to indicate officials are expecting two more hikes this year.
“The Federal Reserve surprised the markets [el miércoles]not because it raised interest rates (because it kept them constant, as expected), but because She was much more aggressive in her speech than expected and in their economic forecasts,” explains Chris Zaccarelli, investment director of the Independent Advisor Alliance.
“Although this policy decision indicates that the Fed has moved from the escalation phase of the interest rate cycle to the calibration phase, there is no doubt that the Fed is fully prepared to continue raising rates in the future if needed,” said Marty Green, Director by Polunsky Beitel Green. “But we should expect their movements to be more erratic and in smaller quarter-point increments thereafter, based on data suggesting that tighter interest rate policy is warranted,” he adds.
For fixed income securities, it is always very sensitive to changes in monetary policy. Government bond yields are rising slightly This Thursday, investors will continue to pay attention to the Fed’s messages. The benchmark 10-year bond offers a secondary market yield of 3.8232%, up two points. Two points also raise the yield on the two-year bond to 4.7267%.
This Thursday, investors (and Fed officials) will also receive new indications of the development of the labor market and consumer spending. Shortly before the opening, for example, it became known that Initial jobless claims totaled 262,000 last week, above the 245,000 that analysts were expecting. While, Retail sales rose 0.3% in May, when the market was expecting a 0.2% decline. Import prices fell 0.6% versus -0.5% estimated, while Empire State manufacturing prices for June rose to 6.6 versus -16 expected.
Furthermore, today, across the Atlantic, the ECB raised its benchmark interest rates again by 25 points, the eighth consecutive hike for the Christine Lagarde-led institution.
On the business front, Lennar is one of the protagonists of the market, gaining 2.8% at opening after beating market expectations with its quarterly earnings. The company announced a sharp decline in earnings per share, rising to $1.32 from $3.01, while revenue fell 4.0% year over year to $8.05 billion. Market consensus had expected earnings of $2.33 per share on revenue of $7.22 billion. Deliveries rose 3% to 17,074, also beating estimates.
Wall Street will also be eyeing some corporate results Thursday, most notably Adobe’s. However, investors will have to wait until after the market closes.
Meanwhile, Autozone announced another $2 billion share buyback authorization in connection with its ongoing program. “AutoZone’s strong financial results allow us to grow our business, return significant amounts of money to our shareholders and maintain our investment grade credit rating,” said Jamere Jackson, the company’s chief financial officer.
American Express falls nearly 2% thereafter Citi has warned that credit card spending has slowed. Citi has opened up negative catalyst surveillance for American Express, warning that travel and leisure categories are seeing a bigger decline than other categories.
Cryptocurrency platform Coinbase is down 4.5% after Mizuho questioned whether traders would switch to Robinhood. The Japanese broker has reiterated its underweight rating.
Better news for Domino’s Pizza after Stifel upgraded its recommendation from hold to buy. The company ensures that home sales will continue to stabilize while takeout sales will increase over the next 12 months.
Retailer Target increased its quarterly dividend by 1.9% to $1.10 per share from $1.08.
Investors must also take this into account today Today, the restaurant chain Cava is traded on Wall Street. The company has set its IPO price at $22 per share, above the previously set range, it announced yesterday.
Cava sold 14.4 million shares, raising nearly $318 million at a price of $22 per share. At $22 per share, the company is worth about $2.45 billion.based on more than 111 million shares outstanding.
Last year, Cava posted net sales of $564.1 million, up 12.8% year over year. However, the company posted a net loss of $59 million, which was higher than the $37.1 million loss in 2021.
In commodity markets, oil prices rose modestly after the IEA forecast that global oil demand growth will peak before the end of the decade.
Annual demand growth will slow from the current 2.4 million barrels a day to 400,000 barrels a day by 2028, the IEA said on Wednesday, attributing the slowdown to the transition to a clean energy economy. The agency also estimated that there will be 4.1 Mb/d of excess supply capacity.
West Texas oil futures rose 0.61% to $69.33 a barrel, while benchmark European crude Brent rose 0.68% to $74.31.
The euro appreciated 0.49% against the dollar until an exchange rate of $1.0889 was established for each common currency.