This Friday, at the opening of the American market, the main indices are recovering on Wall Street. The Dow Jones is firm, and opens at 39,783 pts, trying to retrace the 40,000 pts. The S&P also opened in positive territory, at 5,590 pts. The Nasdaq is also well oriented, and opens at 18,303 pts.
Yesterday, the American market had already ended the session in a scattered order. The S&P 500 fell by -0.88% (5,584 pts). The Dow Jones remained relatively stable, with a gain of +0.08% (39,753 pts). On the other hand, after several records swallowed one after the other and 7 consecutive sessions of increases, the Nasdaq gave back -1.95% to 18,283 pts.
Inflation data points to economic slowdown, opening door for possible interest rate cuts by the Federal Reserve. With the data suggesting a sharper-than-expected deceleration in inflation, June CPI data reinforced expectations for a first Fed rate cut in September.
The core CPI, which excludes food and energy prices, rose 0.1% sequentially, its smallest gain since August 2021, according to Labor Department figures. Headline annual inflation rose +3.3%, the slowest pace in more than three years. Sequentially, consumer prices fell -0.1% in June, the first decline since the pandemic…
These figures have reinforced investors’ expectations of rate cuts by the Fed, and the scenario of a soft landing for the economy, expected by the Federal Reserve. Several Fed officials have, however, indicated that more evidence of a slowdown in inflation is needed before considering rate cuts. This verbal caution from the institution’s leaders still invites stakeholders to be a little cautious so as not to rush beyond the historical records already broken.
Wall Street will rely today on two macroeconomic publications: the American Producer Price Index and the preliminary American Consumer Sentiment Index measured by the University of Michigan (4 p.m.).
The US Producer Price Index released at 2:30 p.m. shows an increase of 0.2% compared to the previous month, slightly more than expected. Over a year, it grew by 2.6% due to a recovery in margins offsetting a second month of decline in the cost of goods.
The dollar remains under pressure and is trading at 0.9178 euros.
WTI barrel is stable at $82.97. Brent is also stable at $85.53.
Gold trades at $2,403 per ounce. Bitcoin is up +0.6% at $57,881.
Values
* JPMorgan Chase (0.2% to $25.28). The financial institution made a quarterly profit of $18.15 billion ($14.47 billion a year ago), driven by the increase in investment banking costs and an accounting gain of $8 billion from a share swap agreement with Visa (+0.95%).
* Wells Fargo (-6.63% to $56.17). The American bank’s second-quarter profit fell to $4.91 billion ($4.94 billion a year earlier), due in particular to the increase in the cost of deposits in a context of strong competition.
* Bank of New York Mellon (+3.6% to $63.68). Net income increased by 10% in the second quarter. Higher investment services fees clearly offset the decline in interest income.
* KKR (+0.3% to $109.12). German media giant Axel Springer, owner of the Bild tabloid and the Politico news site, is considering a spin-off of the company. The U.S. private equity group would take control of the classifieds business, two people familiar with the matter told Reuters.
* Tesla (+1.07% to 243.58). Elon Musk’s company is recovering after a 8.4% drop yesterday. UBS lowered its recommendation from ‘neutral’ to ‘sell’.
