Controlled gains on Wall Street pending the Fed

LAST UPDATE 18:30

The key indicators of the American market have stabilized in an upward movement after the new technological dive yesterday, while the investors are waiting for the minutes of the last meeting of the federal bank, looking for more details for the forthcoming monetary policy moves.

In particular, after sign exchanges for all three indicators in the opening, the industrial Dow Jones is now moving to 32,020 units with a slight increase of 0.3%, the enlarged S&P 500 is strengthening by 0.6% to 3,964 units, as well as the technologically weighted Nasdaq up 0.9% to 11,365 points.

Investors, however, are still worried about an immediate slowdown in growth under tighter monetary conditions, as the war in Ukraine and lockdowns in China worsen the outlook for the economy.

Yesterday, Snapchat’s brutal 43% dip, following its warning, put new pressure on the troubled tech industry, while weak home sales data exacerbated the negative climate in the investor class.

The Nasdaq was down sharply at 2.4%, but the Dow Jones counterattacked its third straight session with a counterattack.

In general, the development of technology securities has been at the center of liquidations since the Fed announced that it is tightening its monetary policy and is accepting most of the pressure in view of any increase in interest rates.

In this climate, the focus will be on the minutes of the last meeting of the Federal Reserve, May 4, published today, with investors looking for further information on the intentions of those in charge of the country’s monetary policy.

It is recalled that at the meeting the bank had raised interest rates by 50 basis points, with its head Jerome Powell stating that inflation is “extremely high and we understand the difficulties it causes. We are moving fast to bring it back lower.”

As Saxo Bank analysts point out, “while the search for any reference to a possible interest rate increase of 75 basis points seems futile, a series of 50-bp increases that will follow remains a key assumption.”

“However, investors are increasingly analyzing the Fed’s discussions looking for signs of stagnation or economic slowdown, and that is what really drives market sentiment right now.”

On the other hand, the publication of financial results continues, with the title of Dick’s Sporting Goods holding an impressive rally after the strongly negative opening.

In particular, its share started trading with a fall of more than 6% against the background of the fact that it downgraded the outlook for the whole year due to inflation and complications of the supply chain, however it now strengthens more than 10% as it exceeded market estimates in size. of its quarter.

Nordstrom also jumped 8.5% after surpassing its quarterly sales estimates.

Retailers in general have been in the spotlight as investors want to see how they deal with the spike in inflation.

Analysts say there is a shift in consumer demand for services rather than goods, with some saying the shares may be “severely punished” for their effects.

The Toll Brothers construction company is giving a further impetus to the market today, which is strengthening by 7% after it exceeded the analysts’ estimates in the quarterly results that it published today.

At the top of the Dow Jones are American Express with 2.4%, Boeing with + 1.5% and Chevron with + 1.3%.

In contrast, Procter & Gamble fell 1.6% and McDonald’s and Merck fell 1.1% each.

Finally, in the macroeconomic news of the day, orders for durable goods in the US increased in April, in an encouraging development that shows that the demand for equipment and goods remains strong despite the rally of inflation.

In particular, orders for durable goods rose 0.4% in April after a 0.6% rise in March, according to the Commerce Department.

The value of orders for basic capital goods, an indication of the course of investments in equipment, climbed 0.3% after an increase of 1.1% in the previous month.

It is noted that the average estimates of analysts in a Bloomberg poll spoke of a 0.6% increase in orders for total durable goods and 0.5% for basic capital goods.