The front of the New York Stock Exchange (GETTY IMAGES NORTH AMERICA / SPENCER PLATT)
The New York Stock Exchange closed lower last week on Friday, but managed to limit its losses thanks to a technical recovery, even if investors remain gloomy.
The Dow Jones industrial average was down 0.30% at 32,899.37 points, the Nasdaq was down 1.40% at 12,144.66 and the broader S&P 500 was down 0.57% at 4,123.34.
After experiencing its worst meeting since 2020 on Thursday, the New York market initially seemed ready to relive a nightmare at the beginning of the session, with the Nasdaq falling as much as 2.65%.
The index with a strong technological aroma fell even for a little below 12,000 units for the first time in 16 months, recording losses of more than 26% since its peak last November.
Peter Cardillo, of Spartan Capital, had warned that the indicators were approaching significant technical thresholds and were likely to find material for recovery there. This happened in the middle of the morning.
“The mechanism worked and prevented prices from falling,” said Karl Haeling of LBBW Bank. “But it could have been better if they had dropped again by 5%, like the day before.
For the analyst, this technical recovery reduces the likelihood that investors will look at current levels as a threshold and start buying again.
The monthly report on employment in the US, published before the stock market, did not help the drivers to get out of their gloom.
First enticed by the 428,000 job creation in April, better than expected, they then saw less encouraging data.
The downward revision of 39,000 for March thus eased the April figure.
In addition, economists have expressed concern about a slight reduction in the labor force participation rate (a ratio between those employed or looking for work and the working age population), while the labor market has already been created.
“There is nothing in there that can steer the Fed one way or the other,” concluded Chris Low of FHN Financial.
In the bond market, yields continued to rise, prompted by the prospect that the key interest rate of the US Federal Reserve (Fed) will reach at least 3% by the end of the year, a scenario that the probability is 85% for operators.
The yield on 10-year US government bonds rose to 3.14%, not far from 3.26%, which is the highest level in 11 years.
“Ultimately, the question is whether monetary policy can bring inflation back to an acceptable level without causing a long-term recession,” said Karl Haeling.
Listed, Under Armor was seen by investors (-25.88% at $ 9.85) after the disappointing results and forecasts. The sports equipment manufacturer expects a drop in its margins as well as a loss of growth of about 3 percentage points due to supply problems.
The release came along with that of Germany’s Adidas, which also suffered from restrictions in China and cut its year-over-year profit targets.
These bad numbers hit the entire sportswear industry, from Nike (-3.49%) to Lululemon (-7.73%).
The DoorDash meal delivery platform was punished (-1.42% at $ 72.11) despite higher-than-expected turnover, with investors staying on a slowdown after the 2020 and 2021 crops boosted by the pandemic.
It was also a difficult day (-7.70% to $ 15.70) for the cycling and cross-country specialist Peloton, who would be looking for investors willing to take a minority stake of around 15 to 20%, according to the Wall Street Journal, for to rescue outside the group’s coffers, which is currently experiencing difficulties.