Inflation, Fed, China, Ukraine … Continues to decline at the opening of Wall Street-May 12, 2022 16:21



The New York Stock Exchange fell again on Thursday, fearing that sustained inflation in the United States could lead to a recession due to the FRB’s monetary tightening.

Around 2:00 pm Greenwich Mean Time, the Dow Jones fell 0.63%, the Nasdaq 1.21%, and the S & P 500 down 0.88%.

Wednesday’s Dow Jones index fell 1.02% to 31,834.11 points, and the broader S & P 500 index fell 1.65% to 3,935.18 points, below the lowest 4,000 points in over a year.

Nasdaq, with its strong technical coloring, plummeted 3.18% to 11,364.23 points.

More than a week? The Dow Jones are down 3.5%, the S & P 500 is down 4.5% and the Nasdaq is down 6.4%.

And since the beginning of the year, the three indexes have fallen 12%, 17% and 27% on Nasdaq, respectively.

Investors have taken a look ahead of the US Producer Price Index (PPI), which opened in April. This shows that wholesale prices have fallen slightly to 0.5% a month, but have risen 11% in a year.

This figure follows the consumer price index (CPI) released Wednesday at 8.3% year-on-year, slowing slightly but stubbornly approaching its highest level in 40 years.

“This data will encourage the Fed to raise rates quickly,” said Rubeela Farooqi, chief economist at HFE.

Wall Street has accelerated its decline since the last 0.5 percent point hike by the US Central Bank on May 4.

“This year’s stock market is surrounded by a number of important issues,” Patrick O’Hare of explained in a memo.

He cites “rising interest rates, changing federal governments, Russia’s invasion of Ukraine, continued high inflation, supply chain bottlenecks (…), and China’s zero-tolerance policy towards Covid.”

Added to this on Thursday was the collapse of cryptocurrencies, which still led to distrust of the digital sector.

Is it very unstable? Bitcoin stabilized at $ 28,100 after falling to $ 25,424 overnight from Wednesday to Thursday. Cryptocurrency stars have fallen 30% month-on-month and are at a level not seen after December 2020.

The bleeding has logically affected companies related to cryptocurrencies recently introduced on the stock exchange.

The Coinbase trading platform, whose stock price plummeted 26.4% on Wednesday, fell to its lowest level since the previous year’s IPO, further down 15.70% to $ 45.

Robin Hood, a brokerage firm that recently provided a Bitcoin-linked fund, plunged 12% to $ 8 after entering the stock market for $ 38 per share less than a year ago.

Beyond that, new economy financial companies continue to suffer, including -3.60% payment specialist Block (ex-Square) after -15.61% the day before.

The dollar, a safe haven, has risen to its 20-year high against major currencies.

“The dollar hit a few years high and the Fed is on track for a sharp rate hike as US inflation continues to be high,” said Joe Manimbo, an analyst at Western Union. Said.

“It’s clear that the Fed’s rate hike far exceeds that of Europe, a scenario that makes greenbacks more attractive than the euro,” analysts further emphasized.

The euro has fallen 1% against the dollar and the euro has reached $ 1.0405, still approaching the same level.

Disney was punished (-3.91% to $ 101) after entertainment giants almost halved quarterly profits on Wednesday in the latest corporate performance of the season. However, the number of subscribers to the Disney + streaming platform is increasing in this group.

Driven by information technology (-2.15%) and energy (-1.69%) in a highly volatile market, 10 out of 11 S & P sectors started in the red.