Wall Street ends sharply higher, on technical buys, without conviction

Wall Street ends sharply higher, on technical buys, without conviction

New York (AFP) – The New York Stock Exchange concluded sharply higher on Tuesday, the sharp decline of last week having created a drag, but pessimism remains dominant.

The Dow Jones gained 2.15% to 30,530.25 points, the tech-heavy Nasdaq index rose 2.51% to 11,069.30 points, and the broader S&P 500 index gained 2 .45%, to 3,764.79 points.

“Whatever metric you were looking at, the market had fallen too low and it was time for a rebound,” said Quincy Krosby of LPL Financial.

For the analyst, the movement was accentuated by operators who had bet on a decline in the indices and had to buy back to cover themselves.

The VIX index, which measures market volatility, fell slightly, reflecting a small increase in risk appetite.

The impression was also found on the bond market, abandoned for less safe assets, primarily equities.

The yield on 10-year government bonds, which moves in the opposite direction to their prices, rose to 3.28%, against 3.22% on Friday (Monday was a holiday in the United States).

The indices were driven by the largest valuations of the rating, from Apple (+3.28%) to Alphabet (+4.11%), via Tesla (+9.35%), Amazon (+2 .32%) or Microsoft (+2.46%).

Only Meta stood out (-4.09% to 157.05 dollars), while the group reached an amicable agreement with the US Department of Justice. Facebook was accused of having offered advertisers to choose who could see their advertisements, in particular according to ethnic, social and religious criteria.

“The question is, is this rebound the right one?”, according to Quincy Krosby, in reference to a possible restart of the market, which would have bottomed out.

Judging by Tuesday’s trading volume, one of the lowest since the start of the year, the day after a public holiday, conviction is lacking and few investors are getting back into the market.

“Do people really want to take risks now, not knowing if the Fed (American central bank) will lead us into a recession or if American companies will lower their forecasts?” Asked Quincy Krosby.

In a speech on Tuesday, the chairman of the Fed’s Richmond, Virginia, branch, Tom Barkin, defended the logic of a slowdown prompted by the US central bank, which a “return to normal” of the economy, while believing that a recession could be avoided.

Wall Street will be watching Fed Chairman Jerome Powell’s hearings Wednesday before the Senate Banking Committee and Thursday before the House Financial Services Committee.

Quincy Krosby expects in particular pressing questions from elected members of the House on “what this aggressive position” of the Fed, in the midst of accelerated monetary tightening, “is going to have as consequences for the average American”.

On the stock market, the American company Spirit Airlines was carried (+7.94% to 22.97 dollars) by the increase in the takeover offer of its competitor JetBlue (-1.64%), from 31.50 to $33.50, which values ​​the company at around $3.64 billion. The shareholders will have to decide, during the general meeting of June 30, between a merger with another company, Frontier, or the acquisition by JetBlue.

Wall Street welcomed Kellogg’s decision (+1.95% to 68.86 dollars) to split into three separate companies to promote the growth of its business dedicated to herbal products, considered the most promising. The Battle Creek (Michigan) group will also create a company regrouping cereals in North America, the third encompassing the rest of Kellogg’s activities.

The specialist in electronic signature contracts DocuSign dropped 1.65%, to 59.55 dollars, after the announcement of the departure of its general manager, Dan Springer.

Supported by an increase in the recommendation of Credit Suisse analysts, as well as by the rise in oil prices, Exxon Mobil paraded (+ 6.22% to 91.48 dollars) with, in its wake, most of the values ​​​​of the sector, from Chevron (+4.19%) to Marathon Oil (3.11%).

After a very delicate week, which saw bitcoin fall below $20,000 on Saturday, the cryptocurrency sector benefited from the small rebound in digital currencies, such as Coinbase (+12.24%), Riot Blockhain (+9.46 %) or Block (+3.44%).

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