Wall Street closes aimlessly hampered by results and conjunctural indicator – Economy

Final session results indicate that the selective Dow Jones Industrial Average index lost 1.14% and the broader S&P500 lost 0.20%. On the contrary, the technological Nasdaq advanced 0.14%, registering the seventh consecutive rising session.

“The equity markets hesitated with the digestion of the mitigated results of the banks”, a “discouraging” indicator and a rise in bond yields, detailed, in an analytical note, Edward Moya, from Oanda.

A three-day long weekend, with Monday’s holiday in the US, also contributed to breaking the ‘élan’ that Wall Street was presenting.

Goldman Sachs, which closed down 6.44%, posted a profit in the fourth quarter far below expectations by analysts, marked in particular by the drop in income obtained from debt issues and placements on the stock exchange.

In addition, the bank tripled its provisions for doubtful loans in relation to the same period of the previous year.

But the stock market outlook was clouded with the release of the single indicator of the day, which showed a higher-than-expected drop in industrial activity in the New York region, which was at the lowest level since August 2020.

In the bond market, yields rose, in part due to the release of better-than-expected indicators in China (gross domestic product) and Germany (consumer confidence), which spurred capital outflows to Europe and emerging markets, which has been happening for several weeks now.

The yield on the 10-year federal debt, which evolves in the opposite direction to the price of the respective bond, advanced to 3.54%, from 3.50% on Friday.

Among the listed, a competitor of Goldman Sachs, Morgan Stanley, closed better than this, with an advance of 5.91%, thanks to a volume of business and profit above expected by analysts. Despite a 49% drop in turnover, asset management held up and provisions remained at a modest level.

If the banks took the Dow Jones and the S&P500 into negative territory, the Nasdaq met another fate, thanks to very volatile values ​​such as Tesla (+7.43%), graphics chart manufacturer Nvidia (+4.75%) or to PayPal (+0.88%).

“We’re seeing stocks struggling to recover, even though the Dow Jones is catching its breath, which is normal after a major rally,” commented Adam Sarhan of 50 Park Investments.

“There are many headwinds” in the market, stressed this investment manager, “and we are only at the beginning of the earnings season. It is too early to assess the health of US companies, but there is a strong probability that we are in the recession phase of the results”.

RN // RBF

Portuguese/late

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