new York Interest rate hopes and rising prices among chip companies pushed Wall Street into positive territory on Thursday. The Dow Jones index of standard stocks closed around one percent higher at 34,907 points. The technology-heavy Nasdaq advanced 0.8 percent to 13,926 points. The broad S&P 500 gained 0.8 percent to 4,505 points.
According to analysts, the hope of an end to monetary policy tightening in Europe also increased US investors’ expectations of interest rate peaks. Most market participants assume that the ECB’s interest rate hike on Thursday will be the last. At the same time, they expect the US Federal Reserve to take a break at its next meeting on September 20th.
“When a major central bank decides to take its foot off the gas, everyone goes along with it,” said Michael Green, chief strategist at asset manager Simplify. “The general feeling at the moment is that the rate hike cycle is over for now.”
Even disappointing economic data could not dampen investors’ spirits. US producer prices, which are seen as a leading indicator of inflation developments, rose faster than expected in August. The Fed is trying to curb inflation by raising interest rates. According to analysts, investors took the figures in stride because they were due to an increase in energy prices.
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Rising prices at semiconductor companies following the renewed IPO of the chip designer Arm also brightened the mood of investors. The shares appeared on the US technology exchange Nasdaq for the first time at $56.10, ten percent above the issue price after around seven years of absence from the stock exchange. The shares went out of trading with a whopping price increase of 24.6 percent to $63.59.
“The game is back on. The capital markets are open for business again. There will be so many IPOs in the next 12 weeks that it will be dizzying,” said Thomas Hayes, chairman of private equity firm Great Hill Capital. “The stock markets have had a year and a half of ice age and this marks the beginning of better times.”
The shares of semiconductor manufacturers such as Micron, Marvell and Broadcom gained between 0.4 and 2.2 percent in Arm’s wake.
Oil prices continue to rise
Meanwhile, a pessimistic forecast by the International Energy Agency (IEA) on global crude oil supplies led to the North Sea Brent variety and the light US WTI variety each becoming more expensive by two percent to $93.75 and $90.32 per barrel (159 liters), respectively . Oil was therefore more expensive than it has been since November 2022.
Oil production cuts extended by Saudi Arabia and Russia until the end of 2023 would lead to a significant market deficit in the fourth quarter, the IEA warned on Wednesday. At the same time, the outlook for global consumption remained largely unchanged this year and next.
US stock market expert Koch: “Arm still has to deliver the high growth”
Demand in China, the world’s largest oil importer, also remains “astonishingly constant” despite its economic downturn. Any further abrupt slowdown in industrial activity and oil demand in the People’s Republic will likely spread to the entire world. “China is the most important wild card,” the IEA report said.
Look at other individual values:
Visas: Negotiations by Visa about a possible share conversion are sending stocks plummeting. The papers are crumbling by 2.5 percent. The US credit card provider has said it is in discussions with its Class B shareholders about converting their shares into Class A or C shares. Shareholder approval would result in an increased number of Class A shares, according to analysts lead and push their value.
AMC Entertainment: The cinema chain’s shares fell 1.21 percent. AMC previously said the stock offering announced earlier this month had been completed. The company said it sold 40 million shares at an average price of $8.14, raising about $325.5 million.
Etsy: Shares of the e-commerce retailer rose 3.28 percent after Wolfe Research upgraded the stock to Outperform. Wolfe cited three reasons for the upgrade: a rebound in consumer spending, the potential for margin improvement and a greater emphasis on Etsy’s core business.
HP: Shares of the printer and PC maker fell 1.8 percent after Warren Buffett’s investment firm Berkshire Hathaway sold some of its shares. The conglomerate sold about 5.5 million HP shares worth about $158 million.
It reduced its stake to $3.27 billion, which corresponds to 11.7 percent of all HP shares. Before the sale, it held a 12.2 percent stake. Berkshire Hathaway first bought the technology company’s shares in April 2022, becoming the company’s largest shareholder.
Exxon Mobile, Chevron: Exxon Mobil and Chevron rose between one and two percent as oil prices hit their highest level this year at over $93 a barrel of Brent crude. Occidental Petroleum and Devon also posted gains early this morning (local time).
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