Wall Street opens lower for the last session of July

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Wall Street opens lower for the last session of July

information provided byAFP•30/07/2021 at 17:16

The New York Stock Exchange was trading lower on Friday for the final session of the month as technology stocks were dragged down by Amazon’s disappointing sales outlook.

By 14:30 GMT, the Dow jones was down 0.28%, the tech-heavy Nasdaq was down 0.56% and the broader S&P 500 index was down 0.43%.

The previous day, the Dow Jones had finished at 35,084.53 points (+0.44%), the Nasdaq at 14,778.26 points (+0.11%) and the S&P 500 at 4,419.15 points (+0.42%), thanks to good quarterly results.

Amazon’s stock fell 7.48% to $3,331 as the internet giant reported disappointing sales the day before after the market closed.

“Amazon has degripped and that’s dragging the rest down,” noted Peter Cardillo of Spartan Capital Securities while among technology stocks Apple dropped 0.50%, Google 0.88% and Microsoft 0.60%.

The e-commerce leader’s quarterly revenue turned out to be $2 billion lower than expected, at $113.1 billion, despite a 27% increase.

In addition, Amazon has been fined €746 million in Luxembourg for failing to comply with the new European regulations on the protection of Internet users’ private data (GDPR).

After a favorable July for the stock market, which reached new records, “investors were taking some money from the table” for the last session of the month, Cardillo noted, citing profit-taking.

Investors were also concerned “about the uncertainties surrounding the Delta variant and the procedures in China”, schwab analysts stressed.

The SEC, the policeman of the American stock exchange, announced on Friday a hardening of requests for information from Chinese groups listed on Wall Street.

The move comes as a series of Wall Street-listed Chinese companies have been subjected to restrictions and investigations by Chinese authorities since early July, plunging these stocks and creating volatility.

On the macroeconomic front, the indicators have been quite positive.

Consumer spending rose by 1% in June and inflation remained stable over the month, but remained at 4% over one year. Manufacturing activity in the Chicago area rebounded in July on strong demand.

Consumer confidence, shaken by inflation, nevertheless held up better than expected in July at 81.2 compared to 80.8 for the first estimate, according to the University of Michigan.

“Inflation remains a wild card for investors. It is still at the strongest pace since 1991,” noted the chief analyst of Spartan Capital.

Consumer product groups such as Colgate-Palmolive (-3.34%) or Procter&Gamble (+3%) warned, during the presentation of positive results, that costs are likely to continue to rise for the rest of the year.

Construction machinery giant Caterpillar, considered a good barometer of the health of the global economy, dropped 3.51% despite strong results driven by a demand boom.

Despite big profits in Q2, oil majors ExxonMobil and Chevron lost more than 1%, as uncertainties around the Delta variant weigh on the assessment of future demand for black gold.

Online brokerage app Robinhood, which missed its IPO on Thursday on Wall Street, was stagnating at $34.90, after it had been introduced at $38.

In the bond market, yields on 10-year Treasuries fell to 1.2273% from 1.2693%.