ROUNDUP / Aktien New York conclusion: decline continues – fear of a decision on interest rates | News

NEW YORK (dpa-AFX) – US stock markets plunged on Monday amid rising interest rates and fears of a recession. Two days before the US Federal Reserve’s decision on interest rates, market participants feared that unexpectedly high inflation could induce currency holders to increase interest rates even more. Technology stocks came under pressure again: their NASDAQ 100 index hit its lowest level since November 2020 and eventually fell 4.60%. to 11,288.32 points.

The market-wide S&P 500 index closed at the lowest level since March 2021, down 3.88%. at 3,749.63 points Compared to the record level in January, it also means a drop by well over 20%, which means that the stock market barometer signals a bear market according to the current definition. The leading Dow Jones Industrial index (Dow Jones 30 Industrial) lost 2.79 percent to 30,516.74 points. At times it was at the lowest level since February 2021 – the recovery in the second half of May died out.

There is nervousness “because, in addition to the dynamics of inflation, there are also signs of falling consumption. This would hit the economy twice and lead to an economic slowdown, said Andreas Lipkow of Comdirect. In addition, the resurgence of the Covid issue in China is getting on the nerves of investors.

“In New York (also), there is a concern that large-cap tech companies like Tesla and Apple, which have not technically yet developed a reversal pattern, will also reverse,” added market analyst Jochen Stanzl. from the CMC Markets broker.

In turn, market strategists from the American bank JPMorgan led by Marko Kolanovi believe that the fall in prices over the last few days is an exaggeration. The significant losses and “sell-off” of cryptocurrencies already priced in during the recession are more than adequate. Experts count on a positive surprise for currency holders and a revival of prices in the second half of the year. This is shown by the sustained strong consumption, freeing the economy from the constraints of the corona pandemic and economic stimulus in China.

They advise investors to focus primarily on equities that are currently relatively low valued, such as particularly innovative companies, companies with a strong exposure to China, smaller companies and biotechnology.

Among the tech companies already battered, Amazon stood out negatively on Monday, losing almost five and a half percent. According to media reports, the world’s largest online retailer, in conflict with EU competition authorities, offered to limit the use of online buyers ‘data and improve the visibility of competitors’ products on the platform.

Tesla (Tesla) shares lost more than seven percent, although another major US company, the electric car maker, announced a share split to make its shares cheaper for small investors. The company of a tech billionaire Elon Musk announced on Friday after the US stock market closed that the board of directors would agree to a three-to-one split if shareholders approve it at an upcoming general meeting. Tesla announced in March that it was planning a split. But it was not clear in what proportion. Even the price increase by the Canadian bank RBC, which now recommends the stock as “Outperform”, did not help the price at the beginning of the week.

Even worse than Amazon and Tesla were cryptocurrency stocks, which were also fined. Shares on the publicly traded Cryptocurrency trading platform Coinbase fell nearly 11.5 percent. At Silvergate Capital (Silvergate Capital A) – a holding company of Silvergate Bank that is heavily involved in cryptocurrencies – shareholders had to deal with an almost 17 percent price loss. Shares of the software producer MicroStrategy, which invested its reserves in the Bitcoin cryptocurrency, lost a quarter.

Prologis shares fell 7.5 percent after the real estate firm announced it had reached an agreement to buy its competitor Duke Realty in a share swap deal involving a debt assumption of approximately $ 26 billion. Duke’s stock rose one percent.

The euro continued to fall: in trade in New York, the single currency recently fell to USD 1.0412 and thus lost significantly for the third day in a row. The European Central Bank (ECB) previously set the reference rate at $ 1.0455 (Friday: 1.0578); the dollar thus cost 0.9565 (0.9454) euros.

Meanwhile, interest rates in the US bond market continued to rise strongly. Recently, government bond yields with a ten-year maturity stood at 3.37%, the highest level in more than eleven years. In return, the T-Note Future contracted by 1.43% to 115.14 points / gl/he

— Gerold Lhle, dpa-AFX —

Leave a Comment