The DOW JONES index rises 0.36% to 45,916.58 points. The most bullish value is McDonald’s, which rises 0.96%, while Sherwin-Williams advances 0.94%. On the decline side, Verizon is down 0.47% and Chevron is down 0.33%.
The S&P 500 rises 0.36%, at 6,562.11 points, while the Nasdaq rises 0.38% to 22,162.83 points.
Wall Street has just suffered a strong correction yesterday, Thursday. The major indices, which had opened with strong advances, ended with sharp declines and very close to their lowest levels of the day. The DOW JONES, which rose more than 600 points, finally lost 386 (-0.84%), while the NASDAQ 100 fell 1.56% and the Nasdaq and 2.15%.
NVIDIA had a lot to do with these behaviors, which went from rising more than 5% at the beginning of the session to ending the day finally falling 3.2% in the midst of its quarterly results. In November, the stock accumulated a decrease of 10.8%, on its way to its worst month since march.
Overall, all AI tech stocks saw a drastic turnaround in the second half of the session, as investor expectations became more moderate regarding the Federal Reserve’s upcoming interest rate decision.
Thus, the main US indices are on track to close the week with a clearly negative balance: The S&P 500 has fallen 2.9% so far this week until Thursday’s close, while the Dow Jones has fallen almost 3%. The Nasdaq has lost 3.6%.
Among the leading stocks this Friday, Intuit rises 4.5% after the solid results of its first quarter. The software company posted earnings of $3.34 per share (adjusted), while analysts had expected $3.09 per share. Revenue reached $3.89 billion during the period, beating the estimate of $3.76 billion.
The trickle of results in the retail sector also continues. Ross Stores registers increases of 2.9% after exceeding Wall Street expectations with its accounts presented yesterday after the closing. Ross Stores earned earnings of $1.58 per share on revenue of $5.6 billionwhile analysts had expected the retail chain to post earnings of $1.41 per share on revenue of $5.42 billion. The CEO stated that the company had an “excellent back-to-school season with positive trends that continued throughout the remainder of the quarter.”
Today Gap celebrates with increases of 8.8% the 5% increase in comparable sales in the US in the third quarterfar exceeding Wall Street’s expectations. The chain claimed sales were boosted by its viral ‘Better in Denim’ campaign featuring Katseye. The retail chain reported earnings per share of 62 cents and revenue of 3.9 billion. Wall Street expected revenue of $3.9 billion and earnings per share of 59 cents.
In other news, investors will have to keep an eye on Palantir after it was revealed that its CEO, Alex Karp, has sold 585,000 shares of the company for $96 million.
Shares of Strategy, one of the largest corporate holders of Bitcoin, fall 2.4% at the open. And today it is mandatory to also talk about Bitcoin, which falls more than 8.3% in the last 24 hours to reach a cross of $83,532 due to the sudden risk aversion of investors. The popular cryptocurrency, which reached a new all-time high in October, has fallen more than 23% in November and is on track for its worst monthly performance since 2022.
Investors need to keep an eye on Robinhood as well, as the stress in the markets has taken its toll on the investment platform. Today its shares are moving upward after collapsing more than 10% yesterday, while so far in November they have fallen 27%.
John Williams (Fed) encourages rate cut expectations
On the macroeconomic agenda of the day, today investors will be attentive to the University of Michigan Consumer Confidence Index. Meanwhile, investors continue to digest the long-awaited September employment report, released yesterday. Initially, he predicted optimism, with a contract that doubled market expectations. However, the unemployment rate reached its highest level in almost four years.
In short, the jobs report did not seem to substantially modify the narrative of a deeply divided Federal Reserve, although today The president of the New York Federal Reserve, John Williams, has burst into the debatewhich at the moment seems to tip the balance towards rate cuts, since it considers that the deterioration of the labor market is more of a threat than inflation. “I still see room for a new adjustment in the short term of the target range of the federal funds interest rate, in order to bring the monetary policy stance closer to the neutral range and, in this way, maintain the balance between the achievement of our two objectives,» he stated at a conference in Chile.
Williams’ statements are significant, since he is considered part of the ‘troika’ that leads the Fed, along with the president Jerome Powell and the vice president Philip Jefferson.
Jefferson also spoke this morning, but limited his words to the impact of artificial intelligence on the economy and financial stability. Last week, the vice president spoke of the need to proceed with caution in future monetary policy decisions. For his part, Powell has not made any public statements since the October FOMC meeting.
After these statements by the influential central banker, the bets turn around and seem to be heading more towards a rate cut in December. According to CME Group’s Fedwatch tool, traders now see a 71.1% probability of a 25 percentage point cutwhile the probability that rates remain in their current range -3.75% to 4.00%- is 28.9%.
In fixed income, always very sensitive to monetary policy expectations, The yield of the US benchmark bond drops today to 4.052% after yesterday’s rise.
In raw materials markets, Oil prices fall sharply this Fridayprolonging losses for the third consecutive session, at a time when the US is trying to push for a peace agreement between Russia and Ukraine that could increase global market supply. US West Texas futures fell 1.90% to $57.88 per barrel, while international benchmark Brent oil fell 1.55% to $62.40.
The euro fell 0.17% against the dollar this Friday, leaving the exchange rate at $1.1509 for each single currency.