Investors expect the Fed to raise rates soon.
(Photo: Reuters)
Frankfurt After the recent price slide, investors are taking the opportunity to re-enter on Wall Street. The US standard value index Dow Jones closed on Thursday 1.8 percent higher to 34,639 points. The technology-heavy Nasdaq advanced 0.8 percent to 15,381 points. The broad S&P 500 gained 1.4 percent to 4577 points.
The price slide in response to the appearance of the newly discovered Omikron variant in the USA was exaggerated, said analyst David Madden of the brokerage firm Equiti Capital. “People will notice that it is not a big problem for the recovery of the US economy.” However, the nervousness will accompany the stock exchanges for some time until scientists have found out more about the danger of the pathogen, said Sam Stovall, chief investment strategist of the research house CFRA.
Opec + surprisingly further expands production
Meanwhile, the oil price went up and down. Opec +, to which other producing countries such as Russia belong in addition to the members of the export cartel, surprised crude oil investors with a further increase in production volumes. The US variety WTI then collapsed by almost five percent at times, but then turned back into positive territory and rose by 1.6 percent to 66.59 dollars per barrel (159 liters) by the evening.
As planned, Opec + will increase the quotas by 400,000 barrels per day in January. Stock traders, on the other hand, had speculated on a break because of a possible slowdown in the global economy as a result of the Omikron variant and because of the price decline in recent weeks. The decision of the exporting countries is apparently based on the assessment that the impairments caused by Omikron will only be temporary, said investment strategist Michael Hewson from brokerage firm CMC Markets. They are betting that demand will pick up strongly in the new year.
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Snowflake: The cloud data company’s shares rose more than 15.85 percent. Snowflake reported third-quarter revenue of $ 334 million, exceeding analysts’ expectations of $ 306 million.
Boeing: One of the favorites on the US stock market was Boeing with a price increase of 7.5 percent. The Chinese air traffic control issued directives to airlines with necessary changes to 737 MAX planes. This is a prerequisite for the machines to be released for operation. After several crashes, numerous states withdrew their flight permits about two and a half years ago. China is a very important market for the Airbus rival, wrote analyst Sheila Kahyaoglu from the investment bank Jefferies. Around 20 percent of all orders for 737 MAX come from this country.
Dig: The initial euphoria quickly gave way to disillusionment at the stock exchange debutante Grab. The shares of the Southeast Asian driver service broker and food supplier fell more than 20 percent after initially gaining almost 21 percent. The Uber rival had merged into the stock market through a $ 40 billion merger with a listed company shell, known in the jargon as the “Special Purpose Acquisition Company” (SPAC).
Apple: The company had told some suppliers that demand for the iPhone 13 models could slow down. This was reported by the business news service Bloomberg. The Apple shares initially fell 2.7 percent, later 0.61 percent.
Lands’ End: The company reported lower-than-expected sales for the third quarter. The clothing retailer earned 22 cents per share, which was in line with forecasts. Land’s End also released a fourth quarter earnings and sales forecast that was below expectations. The shares slipped 9.94 percent.
Dollar General: The shares fell 3.13 percent. The company had announced plans to open 1,000 pop-shelf stores by the end of fiscal 2025. The vision for Popshelf, which targets wealthier suburban customers, was announced a year ago. There are currently 30 pop-shelf stores in six states.
Goldman Sachs: According to three insiders, the US bank wants to set new profitability targets at the beginning of next year. The background is, among other things, the boom in investment banking and trading during the coronavirus pandemic, as Reuters learned from banking circles. Specifically, a return on equity (RoE) of at least 15 percent should be aimed for in the medium term. However, this could still change. When asked, a Goldman spokesman referred to an announcement at Investor’s Day in January 2020 that it would aim for a RoE of 13 percent in the medium term. On Wall Street, Goldman shares rose after the Reuters report and was up 3.2 percent over the course of the year.
More: Twelve stocks that investors can use to invest in the future.