Wall Street: record highs, then all hell breaks loose again
It had all started in the best possible way, with the S&P and Nasdaq raining down all-time highs in the first three quarters... but the rest of the session was marked by lightening on a broad front.
The Nasdaq Composite broke through the 18,000 barrier and set a new all-time record at 18,035: it gained +0.7% over the week, +9% over the second quarter and +18.6% since January 1... while the Nasdaq-100 clipped the 20,000 mark to climb towards 20.017 (i.e. a fivefold increase since February 2016 and a doubling since the end of June 2020) before finishing at -0.55%.
Record also broken for the S&P500 around 4.15pm (-0.4% to 5,460 in the end) after reaching a high of 5,523, i.e. +0.15% over the week, +4% over the quarter and +14.7% since January 1st.
The Nasdaq Composite ended down -0.7% at 17,733, despite gains - and sometimes intraday records - from Microchip, Comcast, MongoDB +2.3%, Qualcomm and AMD +1.7%, NXP and Applied Materials +1.5%.
The Dow Jones (-0.12% to 39.119) was weighed down by Nike's -20% to $75.4, Merck's -4.6%, Amazon's -2.3%, Apple's -1.6%, Microsoft's -1.3% (all three giants also weighing on the Nasdaq).
But over the first half, the Nasdaq crushed the competition thanks to Super Micro +189%, Nvidia +150%, ARM +117%, Meta +42%, Alphabet +30%, Amazon +27%, Microsoft 20.5%. The Dow Jones gained just +4% in the first half, weighed down by Walgreen -54%, Intel -38%, Boeing and Nike -30%. The S&P500 was slowed by the real estate sector (-4%), materials and consumer goods (+5%).
The day was punctuated by the publication of the much-awaited PCE index, but as is often the case when the suspense seems "enormous", it turned out to be a non-event. The annual inflation rate for the 'US consumer basket'- fell by -0.1 points as expected to 2.6% on a reported basis, and by 0.2 points to 2.6% on an underlying basis (excluding energy and food), compared with an anticipated -0.1 point decline on a core basis.
The US '10-yr' gave a very warm welcome to these figures, easing by -4 basis points to 4.26% shortly after 2.30pm... but steam completely reversed from 3.45pm onwards, and the heaviness increased as the hours went by, so that T-Bonds ended at their lowest, with yields soaring by +10 basis points on Friday (and +13 basis points on a weekly basis), to their worst levels since June 11, at 4.38%, with the '30-yr' adding +12.5 basis points to 4.552%.
The Commerce Department also reported that US household spending rose by 0.2% in May compared with the previous month, while incomes rose by 0.5% (more than expected).
It's hard to say whether the majority of "optimists" will continue to anticipate a Fed rate cut at the end of its September meeting (the ratio was balanced at 50/50 on Friday evening), but the strength of growth and persistent inflation (WTI was back up to $81.3) have called into question the idea that the Fed could make several rate cuts this year.
Copyright (c) 2024 CercleFinance.com. All rights reserved.
Go to the original article.
Contact us to request a correction