The New York Stock Exchange moved in dispersed order on Friday, digesting contrasting indicators, which fuel the scenario of continued monetary tightening, but ready for a rebound at the end of the year.
Around 3:20 p.m. GMT, the Dow Jones gained 0.13%, the Nasdaq index lost 0.26% and the broader S&P 500 index took 0.11%. At the start of the session, the S&P 500 fell back to its lowest level in a month and a half.
Investors were freshly greeted by the publication of the PCE price index, the most followed by the American central bank (Fed), which showed a rise of 5.5% year on year in November, against 6.1% the month previous.
But “the market was hoping for a slightly lower figure” for core inflation (excluding food and energy), which is showing at 4.7%, against 4.6% expected, explained Quincy Krosby, of LPL Financial. .
“Inflation remains very high, well above the level that the Fed could accept,” reacted Oxford Economics, in a note.
In fact, the hypothesis of a key interest rate rising above 5% next year, which was largely ruled out a week ago, is once again gaining ground, which is unfavorable to the equity markets.
On the bond market, the yield on 10-year US government bonds tightened to 3.73% against 3.67% the day before.
The PCE survey also showed that consumption had increased by 0.1% over one month in November, less than expected by economists (+0.2%). A break, according to Oxford Economics, explained by the sharp rise in interest rates and the still high rate of inflation.
“A consumption that slows down is bad for the equity markets, because it implies a deterioration of the results of companies”, argued Chris Zaccarelli, of Independent Advisor Alliance.
Nevertheless, the indices rose again with the arrival of another indicator, the consumer confidence index, published by the University of Michigan, which reached 59.7 points in December, better than expected. by economists (59.1).
Some on Wall Street still believe in the possibility of a final end-of-year rebound, despite the prevailing gloom.
“The more the market extends down, the greater the probability of a rebound becomes”, recalls Quincy Krosby. Monday being a public holiday in the United States, there will only be four trading days left to give the indices a bit of a boost.
Listed, Tesla could not stop its fall (-0.37% to 124.88 dollars), which began several weeks ago, despite statements by Elon Musk, the boss and reference shareholder of the electric vehicle manufacturer, who pledged, Thursday during a forum organized on Twitter, not to sell any Tesla title in 2023 “and probably not the year after either”.
A growing number of analysts are warning that the difficulties are just beginning for Tesla, which is facing a slowdown in demand, while Elon Musk “fell asleep at the wheel”, very taken by the Twitter file, “so investors need a leader who can weather the storm,” said Dan Ives of Wedbush Securities.
Targeted in a dark environment, which raises fears for growth, technology stocks continued to suffer, whether Apple (-0.64%) or Microsoft (-0.36%).
Conversely, the Dow Jones was supported by so-called defensive stocks, i.e. considered less sensitive to the economic situation, which were doing well, such as Coca-Cola (+0.43%), the Merck laboratory (+0.58%) or the industrial conglomerate Honeywell (+0.41%).
Airlines continued to suffer from the storm that has begun to hit the United States and is expected to last through the Christmas weekend. Several hundred flights were again canceled on Friday due to weather conditions.
Delta Air Lines (-0.71%) or American Airlines (-0.81%) were thus sanctioned.