Wall Street: S&P 500 is recovering by more than +9% since mid-March
By The Forex Review - 29 / March / 22 549
Dominick Bell
Investors around the world are hoping for a new round of negotiations between the Russian and Ukrainian delegations to reach a peace agreement. The delegations will meet in Turkey today. The emphasis is on the words of Russian Deputy Foreign Minister Alexander Fomin, who announced today that Russia will "dramatically" reduce military operations near Kiev, the capital of Ukraine.
Yesterday, the Dow Jones Industrial Average closed 0.27% higher, the S&P 500 rose 0.7%, and the Nasdaq Composite added 1.31%.
Follow the trend of the S&P 500 index, which has recovered by more than 9% since March 14. Both the S&P 500 and the Dow Jones are also positive for the fourth consecutive session. At 15.43 Italian time, the Dow Jones jumped 350 points (+1%), to 35,305 points; the Nasdaq rose 1.21% to 14,528, while the S&P 500 rose 0.84% to 4,612 points.
Yesterday's Nasdaq purchases saw Tesla shares as the main character, after the SEC announced that the electric car giant founded by Elon Musk will ask the annual shareholders' meeting to "increase the permitted number of ordinary shares... in order to make it possible to split the company's ordinary shares in the form of dividends on shares."
The news of the stock split triggered a rally in stocks, which rose 8% on the Nasdaq yesterday. The stock is still rising today, albeit at a rate of just 1%.
Follow the stock comment made by Erin Brown, Managing director and portfolio manager of Pimco on last night's episode of CNBC's "Closing Bell: Overtime":
"I think everyone should be impressed by the stability of the market, and I come back to the fact that there is no alternative. Do you want to invest in bonds knowing the Fed will raise rates, or do you want to invest in stocks where you know you can cash in some dividends, in the face of real-world earnings growth and encouraging returns in your portfolios?"
Obscuring the mood of those who bet on the US stock market is hiding the inversion of the yield curve, which occurred in the last few hours, in the interval between 5 and 30 years: the inversion was the first since 2006, or 16 years later. The rates of five-year US Treasury bonds are still higher than those of 30-year Treasury bonds, hovering around 2.6023% compared to 2.5862% over a thirty-year period.
However, the spread to be monitored is different: in fact, it is an inversion of the treasury bond curve over a period of 2 to 10 years, which markets see as a sign of the danger of a recession in the United States. The problem is that this difference is also narrowing significantly, so much so that it has sunk to its lowest level since March 2020, a nightmare month for global stocks when the Covid-19 pandemic alarm sounded around the world.
The driving force of the week is the publication, expected on Friday, April 1, of the March US employment report: economists surveyed by Dow Jones forecast job growth of 460,000 units and a drop in the unemployment rate to 3.7%.
Among the important corporate news of today's session, FedEx shares are good after the news about the changing of the guard at the top, as a result of which the founder of the global shipping company, Fred Smith, will resign as CEO on June 1 to be replaced by a figure within the group.
Also prominent is healthcare giant UnitedHealth Group, which announced an agreement to buy LHC Group for $170 per share.
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