(News Bulletin 247) – The New York Stock Exchange opened lower on Thursday, as risk aversion once again took over among investors against a backdrop of fears surrounding the health of the banking sector.
At the end of the morning, the Dow Jones dropped 0.8% to 33,154.5 points, while the Nasdaq Composite lost 0.2% to 11,998.7 points.
The general climate remains dominated by concerns surrounding the soundness of the financial system, illustrated by the very uncertain fate of the Californian bank PacWest.
After being reserved for a while on the decline, the PacWest title lost 50% this morning after having already seen its price divided by five since the beginning of the year.
This pessimism logically weighs on the sector as a whole, which suffered the biggest drop at the start of the day, with a new list of regional banks on the mat, such as Zions (-8%).
Investors are aware that rising rates to 5.25% will start to put many banks in trouble, as the Fed continues to rule out any rate cuts until the end of the year.
Financial stocks are also suffering from the fall in bond yields: at less than 1.34%, the yield on US Treasury bonds is down to a one-month low.
As a result, investors are abandoning equities to fall back on currencies deemed safer, which results in a sudden rise in the dollar against the euro, around 1.10.
Up 0.9% to 2,055.6 dollars an ounce, gold is close to new heights.
Oil prices continue to slide as investors seem resigned to the prospect of an impending slowdown in global demand.
The September contract on American light crude (West Texas Intermediate, WTI) fell 0.2% to 68.4 dollars a barrel, a low of almost two months.
As for values, Moderna climbed 6% after reporting better-than-expected quarterly results and delivering prospects deemed encouraging.
Qualcomm, on the other hand, dropped nearly 7% following more gloomy forecasts, due to the slowdown in the economy, the drop in demand for smartphones and the destocking of its customers.
But the most spectacular fall of this beginning of the day goes to Paramount, which unscrewed by 26% after the publication of a heavy quarterly loss, due in particular to its investments in streaming, which led it to reduce the amount of its dividend.
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