aInterest rate concerns are weighing on global markets.
(Photo: IMAGO/Xinhua)
Frankfurt After the recent slide, investors are feeling their way back to Wall Street. However, the prospect of a sustained rate hike by the US Federal Reserve dampened their buying mood on Wednesday. The Dow Jones lost 0.1 percent to 29,211 points. The tech-heavy Nasdaq fell 0.1 percent to 10,417 points and the broad-based S&P 500 fell 0.3 percent to 3,577 points.
US producer prices rose 0.4 percent mom in September, twice as much as expected. In addition, inflation fell less sharply than had been hoped compared to the same period of the previous year. Inflation is stubborn and speculation about an easing is premature, said Joe Saluzzi, manager at brokerage house Themis.
So the Fed is raising interest rates in large increments. In the minutes of its September meeting, which were published during trading hours, the US Federal Reserve showed its determination to raise interest rates further while keeping an eye on the economic outlook. Investors are certain that the Fed will raise interest rates by 0.75 percentage points for the fourth time in a row at the beginning of November.
This prospect fueled fears of a recession and falling crude oil demand. As a result, the US variety WTI fell by 2.6 percent to $87.04 per barrel (159 liters). A media report about possible US measures against the Russian aluminum industry gave Alcoa a boost. Shares in the US aluminum smelter rose 5.3 percent.
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According to Bloomberg, the United States is considering a ban on Russian aluminum as part of sanctions over the Ukraine war. A direct embargo, a de facto import stop through high punitive tariffs and sanctions against the aluminum producer Rusal, is under discussion. This supplies six percent of global demand.
US stock market expert Koch: “No all-clear on inflation in the USA”
Individual values at a glance
bank values: However, bank stocks rose after the central bank minutes because they can benefit from rising interest rates. JPMorgan shares at the top of the Dow rose 1.6 percent. In the S&P 100, shares in Bank of America, Goldman Sachs, Wells Fargo, US Bancorp and Citigroup gained between 0.3 and 1.0 percent.
Pepsi: Pepsi was one of the winners on the stock market with a price increase of almost 4.2 percent. Thanks to robust demand and price increases, the provider of beverages and snacks is aiming for an increase in sales of twelve percent instead of the previous ten percent. The profit should also be higher. Pepsi also exceeded the increased expectations with the quarterly result, praised analyst Kevin Grundy from the investment bank Jefferies. On this basis, the targets for 2022 appeared conservative. In the slipstream, the rival Coca-Cola put on 1.2 percent.
Moderna: Things also went up for Moderna, which initially headed for the largest daily gain in almost a year with an increase of up to 17.2 percent, only to then close at 8.3 percent in the plus. The biotech company wants to develop and market a cancer vaccine together with Merck & Co. For this, it receives an advance of 250 million dollars from the pharmaceutical company. This is an indication that the ongoing tests for the corresponding vaccine candidate are delivering the hoped-for results, said a broker.
Above and Lyft: Uber and Lyft posted price gains of up to 5.5 percent. Experts expect a year-long dispute over a new US law that makes it difficult for the two driving service brokers and other companies such as delivery services to employ drivers as self-employed. The law could be defused or even completely prevented.
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