The issue is updated.
In the US stock market, there are now more people hoping that the interest rate hike will end, and on Wall Street, this week’s quarterly reports are excitedly anticipated. With two hours left in today’s trading, it looked like this:
- The broad benchmark S&P 500 was mostly up just over 1 percent throughout most of the day.
- The Dow Jones Industrial Average followed with an increase of one percent.
- The rise began with greater frequency on the Nasdaq technology exchange, but after an hour the main index rose 1.2 percent. There, the Nasdaq continued throughout the day.
The week features several quarterly numbers from financial heavyweights such as Goldman Sachs and Bank of America on Tuesday. On Wednesday, Morgan Stanley will follow. In addition, updates from technology companies such as Tesla and Netflix are expected on Wednesday.
The football club falls
Shares of several technology giants, as usual, on Monday topped the list of most traded stocks, such as Telsa, Apple and Nvidia, but Pfizer also awakened investors’ desire to buy after the drug maker beat analysts’ expectations. Pfizer stock rose four to five percent on Monday.
While the stock market is rising, shares of New York’s Manchester United soccer club are falling sharply. Prices fell shortly after by more than ten percent on Monday.
– Investors are clearly reacting with disappointment because the Qatar deal does not appear to be coming to fruition, strategist Susanna Streeter at Hargreaves Lansdown tells Reuters.
Investors’ reactions come after it became known on Sunday that Qatari Sheikh Jassim bin Hamad Al Thani is withdrawing from the offer to buy the football club. Today, the main owner, the American Glazer family, has been considering selling its shares in Manchester United since April, and in recent months the deal took place between British billionaire Jim Ratcliffe and Sheikh Jassim.
Without a potential bid from Qatar, the stock market is concerned about what Ineos CEO Ratcliffe’s offer will include. British media reported earlier that Ratcliffe may have obtained approval before the weekend to buy up to 25 percent of the club’s ownership.
I think inflation has reached its peak
News agency TDN Direkt reported on Monday that the US government’s 10-year interest rate rose to 4.68 percent, up nearly six basis points since Friday, and investment firm Pimco wrote in an update:
We believe that both growth and inflation have reached their peak. We expect growth in various advanced economies to slow to varying degrees and, in some cases, to decline. Broad-based economic resilience this year is likely to give way to weakness next year, with declining fiscal support and the delayed effects of tight monetary policy having a strong global impact, Pimco said.
The report shows the fund manager’s financial projections for the next six to 12 months.
We analyzed 140 austerity cycles across advanced economies from the 1960s to the present day. And in those cases where central banks increased interest rates by 400 basis points or more — as many have done this cycle, including the U.S. central bank, the European Central Bank, and the Bank of England — almost all of them ended in recessions, he points out. TDN Direkt from Pimco report.
According to Pimco, growth and inflation will now have peaked, and there is a “greater risk of recession than markets expect.” Therefore, PIMCO believes that the outlook for the bonds is positive:
– After the recent increase, interest rates have become very attractive, with real and nominal interest rates reaching levels not seen in the country for a decade or more. Today’s high-quality bond funds give returns of five to eight percent. This looks very attractive compared to expected returns in the stock market and provides downside protection in the event of a recession. We also expect bonds and stocks to resume their typical inverse relationship – where bonds do well when stocks struggle, and vice versa, as inflation approaches central banks’ targets over the next year.
Bitcoin with a jerk
On Monday afternoon, the price of Bitcoin saw a rapid ten percent jump, when rumors spread that fund manager BlackRock would launch a newly created listed fund with a mandate to invest directly in the cryptocurrency.
Later, the news was detailed by the US Financial Supervision Commission (SEC), which states that the Ishares Spot Bitcoin ETF is still… Under review. Bloomberg News wrote that the price reaction on Monday shows the extent of interest in the Bitcoin fund, but the sudden and sharp rise in prices also shows that the price of Bitcoin is strongly influenced by loose rumors.
Bitcoin price says four percent on Monday.(conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links that lead directly to our pages. No copying or other use of all or part of the Content may be permitted except with written permission or as permitted by law. For more terms see here.
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