The US Federal Reserve’s latest interest rate decision with a 0.5 percentage point increase in the key interest rate leads to gains on Wall Street.
The US Federal Reserve has boosted the American stock markets with its statements on future monetary policy. As widely expected, the monetary watchdogs significantly increased the key interest rate by 0.5 percentage points in the fight against inflation.
Contrary to some fears on the market, Fed Chairman Jerome Powell emphasized that even larger rate hikes of, for example, 0.75 points are currently not being considered.
The leading index Dow Jones Industrial, which got off to a good start, gained 2.81 percent to 34,061.06 points. It had recovered moderately since the beginning of the week, but on Monday it had temporarily slipped to its lowest level since the start of the Ukraine war on February 24.
The market-wide S&P 500 turned positive on Wednesday after the interest rate decision and said goodbye to 2.99 percent at 4300.17 points from trading. The technology-heavy Nasdaq 100 even gained 3.41 percent to 13,535.71 points after initially severe losses. At the beginning of the week, both indices fell to their lowest level since spring 2021. Technology companies are particularly vulnerable to rising interest rates given their rather higher levels of debt. In addition, the latest economic data from the world’s largest economy largely fell short of expectations.
Lyft with a cloudy view
On the company side, there were again many quarterly reports on the agenda in the middle of the week. The ride service provider Lyft shocked its shareholders with a bleak outlook, as the share price ultimately fell by almost 30 percent to its lowest level in over two years. Uber’s shares also suffered as a result, with a minus of over four and a half percent, although the competitor had given a better outlook.
From China, the New York-listed Didi Global is still at home in the Lyft industry. In the end, however, the paper managed to make moderate gains as the market picked up. In addition to the bad news from the US competition, reference was made to the US Securities and Exchange Commission, which is investigating the 2021 IPO. Because of the US note, Chinese regulators are already focusing on the company.
Moderna stocks closed nearly 6 percent higher on positive news. Thanks to its corona vaccine, the biotech company continues to earn brilliantly, Moderna earned more than three times as much in the first quarter as in the previous year. But there was also great relief because the sales forecast for the corona vaccine remains unchanged, even if the pandemic subsides in western regions. The shares of the Mainz rival Biontech still managed a plus of 1.8 percent.
Win at AMD, Starbucks and Airbnb
The titles of the chip company AMD, the coffee house chain Starbucks and the accommodation broker Airbnb increased by 7.7 to 9.8 percent according to numbers. AMD convinced investors with a jump in sales and profits and the outlook for the second quarter. Starbucks cited strong quarterly sales and an upgrade from Evercore ISI experts. The first quarter was also surprisingly good for Airbnb, it said.
Shares in oil majors Chevron and Exxonmobil gained 3.1 and 4 percent, respectively. They were helped by the rising prices for the important raw material. The EU’s plans for an oil embargo against Russia could push prices up further
The euro – which has been weaker than it has been for more than five years in the past few days below 1.05 US dollars – massively expanded its daily gain and most recently cost 1.0622 dollars. The European Central Bank had previously set the reference rate at 1.0531 (Tuesday 1.0556) dollars; the dollar had thus cost 0.9496 (0.9473) euros.
The initially weak prices of US government bonds also increased visibly. After a cautious start with the interest rate decision, the futures contract for ten-year Treasuries (T-Note Future) turned positive and most recently gained 0.50 percent to 119.11 points. In return, the yield on ten-year government bonds fell to 2.92 percent. This week it rose above the three percent mark for the first time since the end of 2018.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
