MARKET OVERVIEW. The New York Stock Exchange ended the week at half-staff amid tensions over bond yields, the rise in the dollar and oil prices.
Canada’s main stock index fell on Friday, part of a broader pullback that also affected U.S. markets and saw sharp losses in the technology and cryptocurrency sectors.
Consult market news (again).
Stock market indices at close of trading
In Toronto, the S&P/TSX fell 153.99 points (-0.76%) to 20,111.38 points.
In New York, the S&P500 declined 55.26 points (-1.29%) to 4,228.48 points.
the Nasdaq declined 260.13 points (-2.01%) to 12,705.21 points.
the DOW fell 292.30 points (-0.86%) to 33,706.74 points.
the loons was down $0.0032 (-0.4079%) to hit $0.7695.
the oil down $0.48 (-0.53%) to $90.02.
gold fell $10.60 (-0.60%) to $1,760.60.
the Bitcoin fell $2,171.13 (-9.27%) to $21,252.11.
Wall Street initially processed “comments from several regional Fed officials” insisting on the need to continue monetary tightening to curb inflation, analysts at Wells Fargo summed up.
Saint-Louis regional branch Fed President James Bullard on Thursday indicated for the next rate hike in September that he was “biased towards 75 basis points at this point”.
Richmond resident Thomas Barkin reminded him on Friday that accelerating the reduction in the Federal Reserve’s (Fed’s) balance sheet next month by halting asset reinvestment would further tighten financial conditions.
Will the key to the Fed’s messages be given at next week’s central bank symposium in Jackson Hole, where Fed Chair Jerome Powell will speak on Friday?
“Will they send signals for future monetary policy as in previous years? Will they insist on the need for restrictive policies?” asked LBBW’s Karl Haeling.
In the bond market, yields rose to over 2.97% from 2.88% the day before for 10-year Treasury bills, the highest in a month.
Bond yields “are rising around the world and that’s affecting stocks,” commented Peter Cardillo of Spartan Capital Securities.
Karl Haeling also noted that “downward pressure on both the equity market and bonds came from Europe”, with high inflation rates announced in July in the UK (+10.1%) and Germany (+7.5%).
“The implication for the US economy is that if Europe has that much inflationary pressure, it will last longer in the US,” he added.
Oil prices gained ground, boosted by the European gas crisis; the barrel of the American WTI rose to over 90 dollars again.
A risky asset par excellence, Bitcoin fell 9.39% to $21,231. The virtual currency has lost more than $2,000 in the last 24 hours.
The hardest hit was the Nasdaq, where many technology stocks are concentrated, riskier assets that are very sensitive to rate hikes.
Meta (FB) lost 3.84%, alphabet (WELL) 2.27%, Tesla (TSLA) 2.05%.
As for Apple (AAPL)which also discovered a vulnerability on its iPhones and iPads that “could be actively exploited” by hackers, she lost 1.51%.
The vehicle manufacturer Rivian (RIVN) fell 4.04% to $34.45 after announcing it would end production of its cheapest version of its pickup truck.
The Oil Group Occidental Petroleum (OXY) rose 9.88% to 71.29% after Warren Buffett (Berkshire Hathaway) was given the regulatory green light to increase his stake to 50%.
The announcement of General Motors (GM) on the new distribution of a dividend and the resumption of a share buyback program was well received (+2.53%).
The highly speculative title of the ailing homewares brand, Bed Bath And Beyond (BBBY)fell 40.54% to $11.03 after the exit of one of its major shareholders.
Ryan Cohen, owner of the video game store chain, Game Stop (GME)disposed of a stake of around 11.8% in the company.
Earlier in the week, he announced his capital increase, leading investors to believe he would be a long-term partner, doubling the value of the stock in a matter of days.
Some investors got it wrong and are calling for an SEC investigation.