(News Bulletin 247) – Wall Street is expected to fall on Friday morning, still weighed down by the Apple file and by the prospect of another rate hike this year due to the strength of inflation.
Half an hour before the opening, the ‘futures’ contracts on the major New York indices yield around 0.1%, announcing a continuation of the bout of weakness of the last few days.
Over the whole week, which was shortened due to ‘Labor Day’, the Dow Jones is currently down around 1%, while Nasdaq is down around 2%.
The recent surge in oil has heightened concerns about the persistence of inflation, which could lead the Fed to extend the tightening of its monetary policy.
The much better than expected figures for the labor market and the services ISM, which this week confirmed the resistance of the American economy, argue a priori for a new rate hike.
‘The market faces a number of risks’, acknowledges a trader. ‘Uncertainty could therefore continue to weigh on investor sentiment,’ he adds.
Some analysts point out that this disappointing start to the month is not surprising given the bad reputation that the month of September has built up, with an average decline of 1.5% over the last ten years, compared with a gain of 1.1% for the other months of the year.
Market sentiment is also affected by the recurring difficulties of Apple, which again lost 2.9% on Thursday after falling 3.6% the day before, making the heaviest contribution to the decline in New York.
Investors fear a ban by Beijing on the use of foreign brand smartphones by Chinese officials in their workplace, which could weigh on the group’s sales.
“The technology sector should however continue to benefit from the positive effects linked to the development of artificial intelligence,” said a trader.
The market more generally seems to be in need of a breather given its high valuations, with the Nasdaq paying more than 30 times the expected results compared to 24.8x last year.
On the bond market side, the yield on 10-year Treasuries continued to fall below 4.25%, with the aversion to risky assets benefiting Treasury bonds, deemed safer.
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