First, the tensions between the US and China caused uncertainty on the US stock markets – now the mood has changed. It has to do with economic data.
After the recent defeat, US stock markets continued their July recovery on Wednesday. The impulse was given by optimistic economic data from the world’s largest economy.
The Dow Jones Industrial index rose by 1.29 percent to 32,812.50 points. However, the most famous Wall Street index has not been able to recover from the losses since the beginning of the month.
The situation was different for the general-market S&P 500 index and the Nasdaq 100 technology selection index. The S&P 500 index rose 1.56% to 4,155.17 points and closed at the highest level since early June. The Nasdaq 100 gained 2.73 percent to 13,253.26 points, returning to its highest level since early May.
During the last two days, the US indices weakened after the extremely strong month of July. While they were still fairly stable on Monday, the situation deteriorated markedly on Tuesday. The threats from China related to the visit of US House of Representatives President Nancy Pelosi to Taiwan and comments from the Federal Reserve regional governors on inflation were very important.
Investors were now interested in new data on economic development in the United States. In July, the mood in the US services sector improved surprisingly. In addition, ISM Services is also clearly in the growth area. “There are no indications that the sector is shrinking and against this background, concerns about growth should diminish,” said economist Helaba Ulrich Wortberg. Orders received for the US industry in June were also published. Compared to May, they grew much stronger than forecasted.
On the side of the company in the middle of the week, the main focus was on companies listed on the Nasdaq, where they were in the lead: Moderna was the biggest winner with a 16% gain. Regeneron jumped almost six percent. The biotechnology company Moderna continued to use its corona vaccine in the past quarter and also announced a share buyback program. Regeneron made a positive surprise on the sales side with its hit drugs Dupixent and Eylea.
Paypal up despite falling profits
Paypal shares rose 9.3 percent from the Nasdaq 100, even though the payment service saw profits plummeting in the second quarter. This was mainly due to special factors such as higher taxes – day-to-day operations were relatively smooth. Investors also welcomed the news that investor Elliott, known for his emphasis on high returns and commitment to management, is one of the largest shareholders with a stake of around $ 2 billion.
Starbucks, also included in the Nasdaq 100, gained 4.3 percent. The coffee shop chain significantly increased sales in the last quarter, despite burdens in China. Moreover, while profits fell, they continued to exceed expectations.
On the other hand, AMD shares, one of the biggest losers in the Nasdaq selection index, lost 1.2 percent. The chip company disappointed with sales forecasts for the current third quarter. The Tinder app’s home match group is down 17.0 percent after disappointing in the outlook for the current third quarter.
In the S&P 100 index, Ford shares rose 3.5 percent after strong sales in July. Among smaller values, papers from Tupperware, the manufacturer of fresh storage boxes, rose sometimes by 65 percent after better-than-expected quarterly figures. At the end of the trade, the plus was almost a third.
At the close on Wall Street, the euro was traded at $ 1.0169. The European Central Bank previously set the reference rate in Frankfurt at 1.0194 (Tuesday: 1.0224) dollars. The dollar thus cost 0.9810 (0.9781) euro.
In the US bond market, government bonds turned positive after weaker development. The T-Note Future rose 0.25 percent to 120.42 points. The yield on ten-year treasury bonds fell to 2.71%.