Wall Street down, crumpled by a flurry of mixed indicators

New York (AFP) – The New York Stock Exchange was trading lower on Thursday as investors digested a series of mixed macroeconomic indicators and another rise in bond yields.

Around 2:35 p.m. GMT, the Dow Jones yielded 0.02%, the Nasdaq index dropped 0.60%, and the broader S&P 500 index lost 0.43%.

The session was expected to be volatile, warned Peter Cardillo of Spartan Capital, due to the expiry on Friday of stock and index options, as well as so-called index futures, various futures contracts that weigh several billions of dollars.

This event, called “three witches” day, often causes additional volatility on Wall Street.

The three benchmark markers of the New York Stock Exchange, Dow Jones, Nasdaq and S&P 500, thus opened in the red, before returning ostensibly to the green, then running out of steam and falling again into negative, all in less than an hour.

Before the opening, Wall Street had been caught in a deluge of macroeconomic indicators, “a contrasting set”, according to Peter Cardillo.

Expected to be stable, retail sales rose 0.3% in August, but excluding vehicle sales, they fell 0.3% over one month.

As for new weekly jobless claims, they recorded a further decline, the fifth in a row.

In terms of inflation, the topic of the moment, import prices fell by 1% over one month, less than the 1.2% expected by economists.

The activity index for the Philadelphia region contracted when it was expected to expand, while the same indicator for the New York region fell less than expected.

For Bill Adams, of Comerica Bank, this new volley of data “means that the Fed (the American central bank, editor’s note) should raise its rate by three quarters of a point next week”, and not by one point, as it is. was discussed recently.

The diagnosis is shared by most operators, Wall Street giving this scenario a probability of 80%, according to the model of the CME Stock Exchange.

“The pace of rate hikes after September will depend on how quickly the economic slowdown translates into a weaker labor market,” added Bill Adams, noting that “so far the process has been rather gradual.”

In addition to the indicators, the New York market was subject to two factors on Thursday, according to Peter Cardillo. On the one hand, the rise in bond rates. The yield on ten-year US government bonds was 3.44%, compared to 3.40% the day before.

The two-year rate, which is more sensitive to monetary policy expectations, soared to 3.87% for the first time in almost 15 years (November 2007).

On the stock exchange, Adobe was sanctioned (-13.00% to 323.23 dollars) after the announcement of the acquisition, for 20 billion dollars, half of which in shares, of the collaborative design platform Figma, which had become the one of its major competitors.

Badly treated in recent days, the rail transport companies breathed after the announcement of an agreement with the last two unions which had not yet found a solution to the collective negotiations carried out this year.

The news comes a few hours before a deadline, set for Friday, beyond which the unions of freight railway workers threatened to start a strike.