Trading on Wall Street closed this evening (Thursday) with sharp declines in the shadow of fears that the Fed’s aggressive fight against inflation could drag the US economy into recession, while in the background investors are shying away from the slump recorded in the foreign exchange markets alongside the jump in bond yields around the world, which is expected to stifle credit conditions .
The Dow Jones index lost 1.5%, the Nasdaq fell 2.8% close to the low recorded in June, the S&P 500 index recorded during trading the lowest price since the end of 2020, and the fear index (VIX) jumped about 6%.
Technology stocks led the declines, with Tesla shedding about 7% of its value, Apple losing 4.8%, and Nvidia down about 4%.
Selling pressure in the bond market renewed after statements by Fed officials gave no indication that the central bank would moderate or change its plans to raise interest rates aggressively to lower high inflation. Cleveland Fed Chairwoman Loretta Mester said she does not see distress in U.S. financial markets “B that you change the determination of the central bank to lower inflation.
Earlier today, the data on the initial claims for unemployment benefits in the US were published, which indicated that the number of jobseekers was 193,000 compared to an expected 215,000. This is a positive figure in contrast to the 2008 crisis in which the labor market was damaged and brought the central bank to act in the market.
“We are at the beginning of a very big storm, we have indeed seen the process in the stock market, which is reminiscent of the 2008 crisis, we see the same today that the stock market reacts earlier, but maybe also in the currency market, I think the big crisis is still ahead of us,” said Yossi Freiman, CEO of Frico, in an interview with Sponsor TV.
17:00
Sharp declines in New York. Wall Street’s leading indexes are down after yesterday’s lull, with the Nasdaq already losing 3.2%, the Dow Jones down 2.5% and the S&P 500 cutting 2.6%. The fear index (VIX) jumps 10%.
US government 10-year bond yields rise to 3.8%. Only 6 stocks in the S&P 500 index are painted green.
Apple falls 4.7%, Tesla falls 6.5%, Nvidia loses 5%, auto retailer Car Max falls more than 20% after weak reports.
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Zim’s stock falls to an annual low and falls 8.7%, Iron Source falls by a similar rate, Monday falls by 6.3%, Teva falls by 3% to a price of $7.72, Tower falls by 1.4% to a level of $44.1.
16:30
Trading on Wall Street opened with sharp price drops after yesterday’s gains. The Nasdaq loses 1.5%, the Dow Jones falls 0.9% and the S&P 500 loses 1.3%. The fear index (VIX) jumps 5%.
15:00
After yesterday’s sharp price increases in the USA and breaking a negative streak of 7 trading days in the S&P 500 index, Wall Street is expected to open trading with price decreases of about 1% in the leading indices.
Yesterday the leading indices rose about 2% together with sharp decreases in the yields of the government bonds that reacted in the US and all over the world to the action of the English bank that purchased long government bonds yesterday about 1 billion pounds.
The yield on the US government’s 10-year bonds rose to 3.82% today after yesterday it traded near a 4% yield. The dollar continues to strengthen globally and rises by 0.35% against the euro and against the British pound.
In Germany, the concerns were justified, and the inflation rate jumped to 10% against an expected increase to 9.4%. The consumer price index in September rose by 1.9% against expectations of a 1.3% increase. In response, the DEX deepens the declines and loses 1.5%, the French CAC and the British FTSE drop 1.4% and 1.1% respectively.
Oil traded with slight decreases of 0.25% to the level of 82 dollars per WTI barrel.
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Apple (AAPL), which was holding back yesterday and fell 1.3%, is losing another 2.2% in advanced trading after Bank of America downgraded its recommendation from ‘buy’ to ‘neutral’. Bank of America expects a negative impact due to the expected consumer weakness.
Bed Beth & Beyond (BBBY) reports before trading on a loss higher than forecasts, as well as a decrease in margins and the removal of excess inventory accumulated in warehouses and chain stores. The stock is up 5% in early trading.
Wright Aid (RAD) is plunging about 12% in early trading after reporting a smaller-than-expected loss and weak revenue. The company provides a weak forecast for the rest of the year.
Warren Buffett continues to increase holdings in Occidental Petroleum (OXY) with the purchase of nearly 6 million shares this week. Breakshire Hathaway owns 20.9% of the energy company’s shares. We note that the company’s shares fell by about 20% in the last month following the retreat in oil and natural gas prices.
Carmax (KMX) crashes by about 16% in early trading after the automotive retailer missed the profit and revenue line last quarter. The company reported a sharp drop in sales in recent months.