Wall Street: Wall Street bounces back, eased by resistance from the US economy

by Sinéad Carew, Sruthi Shankar and Johann M Cherian

(Reuters) – The New York Stock Exchange rebounded strongly on Tuesday, supported by strong indicators that reassured investors about the health of the U.S. economy despite the prospect of another rate hike by the Federal Reserve in July.

The digital giants especially contributed to today’s emergence.

After six consecutive sessions of decline, the Dow Jones index rose 0.63%, or 212.03 points, to 33,926.74 points.

The broader S&P-500 rose 49.59 points, or 1.15%, to 4,378.41 after falling in five of the previous six sessions.

The technology-heavy Nasdaq Composite rose 219.9 points (1.65%) to 13,555.67 points and is on track for its best first half in 40 years.

After last week’s negative sequence, driven by the aggressive speech of the chairman of the Fed, Jerome Powell, the trend was supported by a volley of favorable macroeconomic indicators in the US: in May, new orders for goods rose unexpectedly. while sales of new homes rose sharply; and in June US consumer confidence hit an almost year-and-a-half high.

In addition to this encouraging data, Rhys Williams, chief strategist at Spouting Rock Asset Management, evokes economic factors to explain today’s progress.

“We had a bad week last week in the stock markets and a bad day on Monday. It’s just a turnaround,” he said. “There can also be a bit of an end-to-end trompe-l’oeil phenomenon.”

The positive signals for the economic situation benefited the Dow transport sector index (+2.7%) and the Russell 2000 index of small caps (+1.5%).

For its part, the Philadelphia index of the real estate sector (+2.99%) reached a session high.

Rating heavyweights carried the day’s momentum, such as Microsoft (+ 1.8%) or Apple (+ 1.5%). Meta Platforms took 3.1% after a price increase from Citigroup.

Tesla gained 3.8% as its charging system looks set to become the standard for electric vehicles in North America.

Walgreens Boots Alliance, on the other hand, fell 9.3% as the pharmacy chain warned about its annual profit due to weaker-than-expected demand for COVID-19 tests and vaccines.

Electric truck maker Lordstown Motors fell 17.2% after filing for bankruptcy protection on Tuesday and filing for sale following a dispute over a promised investment by Foxconn.

(Written by Sinéad Carew in New York, Sruthi Shankar, Johann M Cherian in Bangalore and Terence Gabriel in New York, French version Bertrand Boucey)

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