(News Bulletin 247) – Wall Street started the session on a heavy note on Monday, investors not having too much of a taste for risk in the face of the rise in geopolitical risk, which occurs in a climate already marked by uncertainties concerning the changes in the economic situation.
At the end of the morning, the Dow Jones fell 0.1% to 33,682.9 points, while the Nasdaq Composite dropped more than 0.3% to 13,446.9 points.
Many strategists believe, however, that the failed insurrection attempt by the Wagner Group this weekend in Russia does not foreshadow a change likely to affect the market.
“From our point of view, these are typically the kind of geopolitical events which are widely commented on but which have absolutely no impact on investments”, underlines Joachim Klement, at Liberum.
‘And if that were to be the case, a change of regime in Russia would rather support stock market prices and, on the contrary, weigh on oil and gas prices’, he continues.
The Russian events of the weekend nevertheless favor a decline in safe havens which notably benefits gold, which posted a gain of 0.2% to 1934.9 dollars an ounce.
Risk aversion is also fueling a decline in government bond yields, with 10-year bonds losing almost 10 basis points to return to 3.71%.
The CBOE volatility index – often dubbed the barometer of fear – is up 5% to 14.2 points.
The most defensive sectors such as real estate (+1.5%) or community services (+0.5%) are the most sought after. Also on the rise, the energy compartment climbed 1.5%.
The surge in tensions in Russia is contributing to a small rebound in oil prices, with American light crude (West Texas Intermediate, WTI) trading above 69 dollars, against 67.6 dollars on Friday.
On the value side, Pfizer drops 4.5% after deciding to stop the clinical development of an anti-obesity drug due to drug interactions and elevated transaminase measurements in phase I studies.
Tesla lost more than 3% after a downgrade by Goldman Sachs analysts, who are no longer buyers of the stock following its impressive stock market performance in the first part of the year.
No economic indicator is on the agenda for the day.
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