The indexes Nasdaq and S&P 500 closed at new records this Wednesday on Wall Street, in a shortened session, as a A series of weaker economic data fueled hopes for faster interest rate cutsone day before the celebration of July 4th.
The Dow Jones Industrial Average closed at 39,308.00 points, down 0.1%, the S&P 500 was at 5,537.02 points, up 0.5% and the Nasdaq Composite gained 0.9% to 18,188.30 points.
Wall Street’s major indexes had a shortened trading session on Wednesday ahead of Thursday’s Independence Day holiday.
Economic data surprises negatively and raises hopes for rate cuts
Orders to US factories unexpectedly fell and US services activity contracted, pointing to an economic slowdown, fueling concerns. hopes of interest rate cuts earlier than expected.
Minutes from the Fed’s June meeting are due to be released after the session is over, and many are eager for more clues about the central bank’s thinking on monetary policy and inflation.
Investors are looking for additional guidance on “the Committee’s assessment of the balance of risks, concerns about rising inflationary pressures and further information on the downgrade of rate cut expectations,” Stifel Financial Corp said in a note Wednesday.
Nonfarm payrolls slow
Just a couple of days after the release of the nonfarm payrolls report, ADP’s National Employment Bulletin (Job Analysis and Description) showed that private payrolls increased by 150,000 jobs in June, below the revised growth of 157,000 in May, consistent with slowing labor market momentum.
Market participants see a 68% chance of first rate cut in Septembercompared to 58% last week.
Most notable movements in equities
The actions of Paramount Global rose more than 11% after Reuters reported that Shari Redstone’s National Amusements had reached a preliminary agreement to sell a majority stake in the film studio to David Ellison’s Skydance Media.
Constellation Brands fell more than 3% after reporting that first-quarter sales missed estimates.
“We view these results as weak, but they were largely expected as consensus earnings estimates declined throughout the quarter,” Truist Securities said.
Oil price hike boosts energy stocks
Energy stocks closed higher on Wednesday, supported by rising oil prices after the Energy Information Administration reported that crude oil inventories fell by 12.2 million barrels in the week ended June 28, beating expectations for a drop of about 400,000 barrels.
Kinder Morgan, Williams Companies and Schlumberger rose more than 1%.
Jeff Bezos in selling mode
Jeff Bezos announced a plan to dispose of an additional 25 million shares of Amazon for a value of US$5,000 million the day the stock hit a new record.
The notification was filed after the market closed on Tuesday, although sales could also take place on the same day.
Bezos sold about $8.5 billion worth of stock over nine trading days in February, the first time he has disposed of the company’s shares since 2021. Additional sales would bring his total this year to about $13.5 billion.
After the latest sale, Bezos would still own nearly 912 million shares or about 8.8% of Amazon. It is the second richest person in the world with a net worth of $221.6 billion, according to the Bloomberg Wealth Index. He also owns the space exploration company Blue Origin and the Washington Post newspaper.
Source: Ambito
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