Wall Street falls as the Dow Jones breaks its three-week winning streak

Wall Street falls as the Dow Jones breaks its three-week

The stock market reaction to the accounts, which have beaten expectations, has been tepid to say the least.

Wall Street closed with losses in the session this Friday (Dow Jones: -0.86%; S&P 500: -0.75%; Nasdaq: -0.80%) in which the Dow Jones has broken the streak of three weeks in a row of earnings; 0.52% has been left in the last 7 days. Likewise, the fall of the other two indices was higher: 1.89% for the Nasdaq and 0.97% for the S&P 500.

Inflation continues to worry market participants. The last to refer to it has been the US Treasury Secretary, Janet Yellen, who on CNBC anticipated “that it will return to normal levels in the medium term”, but not without first acknowledging that “it does not seem like a phenomenon of a single month”, contradicting the idea of ​​some high officials that it was simply something transitory.

These words come after the speech of Jerome Powell, president of the US Federal Reserve (Fed), in the Senate this Thursday, where he indicated that he did not feel “comfortable” in the face of price pressure in the country.

“This is a shock that the system is going through associated with the reopening of the economy, which has driven inflation well above 2%,” he reiterated. Powell argues that inflation is due to pandemic-related bottlenecks and supply constraints for a small group of goods and services. He thinks that an exaggerated reaction to something specific would be a mistake.

RETAIL SALES RISE

As for the macroeconomic indicators, this Friday the ones referring to retail sales were published, which rose 0.6%, higher than expected. Regarding the data of retail sales excluding automobiles, it has also grown by 1.3%, above forecasts.

“This report should tone down some of the recent comments about consumer fading, which we have found quite surprising given that households have $2.5 million in additional savings accumulated during the pandemic, while wage income is down. being driven by the recovery of the labor market,” said Ian Shepherdson of Pantheon Macroeconomics.

On the other hand, the consumer sentiment index published by the University of Michigan has fallen to 80.8 from 86.5. Analysts indicate that it is due to the decline in the components of current conditions and expectations.

“We assume that the end of improved unemployment benefits – announced or real – in 26 states led by Republicans has caused an adverse reaction among consumers; people do not like to have their money taken away,” they point out from Pantheon Macroeconomics.

At the geopolitical level, the United States is preparing to impose sanctions this Friday on several Chinese officials for Beijing’s crackdown on democracy in Hong Kong, while issuing a warning to international companies operating there about deteriorating conditions, as reported by Reuters citing two people with knowledge of the situation.

COMPANIES AND OTHER MARKETS

On the business front, Moderna is news for the 10% rise in the stock market after the announcement that it will be part of the benchmark index of the US stock market, the S&P 500. It will replace Alexion Pharmaceutical when the purchase of this company by AstraZeneca. It is expected to be on July 21.

Tesla, which has fallen 1%, is in the news after the controversial statements (for a change) of its CEO, Elon Musk, when he acknowledges that the Cybertruck can fail, although it seems not to care. I do not mind. I love it, even if others don’t like it. Other trucks look like copies of the same thing, but the Cybertruck seems made by aliens from the future, “he wrote.

In addition, Intel is in talks with Mubadala Investment Company to acquire the chipmaker GlobalFoundries, as reported by The Wall Street Journal. Despite this, shares have fallen 1.51%. Despite this, the newspaper states, citing people familiar with the matter, that the negotiations may not be successful because the UAE company is exploring a large initial public offering.

On the technological side, the semiconductor and microchip manufacturer Nvidia has been one of those that has yielded the most, almost 5%.

In other markets, West Texas oil fell 0.14% to $71.55, while the euro depreciated 0.07% and changed to $1.18, while the ounce of gold dropped to 0, 94%, up to $1,811. Finally, the yield on the 10-year Treasury bond rises to 1.302% and bitcoin appreciates 1.17%, to $31,908.