Wall Street starts up slightly ahead of Fed minutes

Wall Street démarre en légère hausse avant les minutes de la Fed
July 7, 2021
China crackdown on tech and overseas-listed shares prompts sell-off of Didi, others
July 7, 2021

Wall Street starts up slightly ahead of Fed minutes

The New York Stock Exchange started slightly higher on Wednesday before the publication of the minutes of the last meeting of the US Central Bank (Fed).

At 14:10 GMT, the Dow Jones index rose by 0.07%, the Nasdaq, with strong technological coloring, gained 0.20% and the broad index S&P 500 advanced by 0.18%.

The day before, Wall Street had finished in dispersed order after a difficult day for Chinese stocks. The Dow Jones lost 0.60% to 34,577.37 points and the S&P 500 dropped 0.20% to 4,343.55 points while the Nasdaq gained 0.17% to 14,663.64 points, a new record.

According to Peter Cardillo, chief economist at Spartan Capital Securities, “all eyes will be on the Fed minutes,” which will report in detail at 6:00 p.m. GMT on the last monetary meeting on June 15 and 16.

The central bank had shaken the markets by raising its inflation expectations and starting to discuss when a plan should be made to reduce asset purchases that help keep interest rates down and support the market. reprise.

“The key will be to see if they have gone further on the idea of ​​reducing purchases” of treasury bills and other assets, explained Mr. Cardillo. But according to him, a surprise in this direction is unlikely and “after the Fed, the market could accelerate and lead to a positive session”.

US 10-year bond yields did not seem worried, falling to 1.30% from 1.34% the day before.

Shortly after the opening, almost all sectors of the S&P were green, driven by materials (+ 0.70%), information technology and consumer products (+ 0.50%).

Amazon, which had finished sharply the day before, continued its momentum (+ 1.20% to 3,720 dollars) taking advantage of the cancellation by the US Department of Defense of its mega-contract for “cloud” with its rival Microsoft (+ 0.53%).

Action by “Chinese Uber” Didi, which lost nearly 20% on Tuesday after China’s cybersecurity authority ordered the platform to be removed from all app stores over the weekend , was still slipping by 7%.

The deterioration of relations between China and the United States on the technology front has taken a regulatory turn that increasingly affects Chinese companies listed on Wall Street.

The Chinese warning issued to Didi, which went public only a week ago, “is” a sign of danger because it is an attack on the United States, “said the expert from Spartan Capital Securities. it is not resolved it could become really damaging for the relationship between the two countries, “added Peter Cardillo.