The Dow Jones Industrial was up 0.25% at the close. and amounted to 38,807.33 points. The S&P 500 gained 1.18% at the end of the day. and amounted to 5,354.03 points. The Nasdaq Composite rose 1.96%. and closed the session at 17,187.90 points. The Russell 2000 index of small-cap companies is up 1.46%. up to 2,063.61 points The VIX volatility index falls by 4.10 percent, to 12.63 points.
“I have a positive attitude towards the cut because it means the end of the era of high rates”
Markets are waiting for the European Central Bank's decision, which will be published on Thursday at 2:15 p.m. Investors expect a reduction in interest rates. by 25 bp. If there are no surprises, market observers will focus primarily on the press conference of ECB President Christine Lagarde and what actions the central bank may take later in the year.
On Thursday there will be a decision on interest rates. will also be issued by the Bank of England. “Even if the ECB cuts interest rates tomorrow, one of the questions that will arise, especially given recent inflation data, is to what extent the ECB can cut interest rates further and over what time frame,” said Richard Flax, director of . investment in Moneyfarm.
“I have a positive attitude towards the cut because it means the end of the era of high rates that started two years ago. Now we need to see what impact the rate cuts will have on domestic demand and economic recovery,” said Carlo Franchini, director of institutional clients at Banca Ifigest.
The markets will also focus on Friday's US labor market report for May. Economists expect the number of nonfarm payroll jobs in the United States to increase by 185,000 in May, a slight increase from the previous month. The data will be closely watched in the context of possible actions by the US Federal Reserve.
“If you are optimistic about the labor market situation and see that US corporate earnings revisions are generally positive, it gives a positive environment for stocks,” said Richard Flax, chief investment officer at Moneyfarm. The UBS baseline forecast assumes that the S&P 500 will reach 5,500 points by the end of 2024, which means an increase of 3.9%. compared to current levels.
“Although the U.S. economy is slowing, we see no evidence to suggest the so-called “hard landing”
“Although the U.S. economy is slowing, we see no evidence to suggest the so-called hard landing. This means the outlook for equities is positive and interest rate cuts will provide tailwinds amid solid earnings and a secular market trend driven by generative AI,” UBS strategists wrote in the report.
Nvidia continues its multi-month AI-powered growth trend. On Wednesday, the company's shares gained 5%, which means a new record and a market value of $3 trillion. The chipmaker unveiled new chips earlier this week that received more praise from Wall Street analysts. Bank of America forecasts that Nvidia shares could rise to $1,500, which gives it a 22% upside potential.
Dollar Tree fell 5%. after disappointing quarterly earnings forecasts for the markets. The company said it would consider options including a potential sale or spin-off of Family Dollar. Intel gained 2.5 percent. after Apollo Global Management agreed to buy 49 percent. $11 billion stake in a joint venture related to the chipmaker's manufacturing unit in Ireland. Applied Materials rose after brokerage Barclays upgraded its rating on the chipmaker's stock to “equivalent” from “underweight.”
CrowdStrike Holdings gained 12%. after forecasting second-quarter revenue above estimates, citing strong demand for cybersecurity solutions. Hewlett Packard Enterprise increased by 11%. The company forecasts third-quarter revenues above market expectations.
The ISM index of activity in services in the US in May increased to 53.8 points. with 49.4 points in last month. Analysts expected the index to reach 51 points. The PMI composite index in the US, prepared by S&P Global, increased to 54.5 points in May. with 51.3 points in the previous month – given in the second calculation. The initial estimate was 54.4 points. The PMI index, determining the economic situation in the American service sector, prepared by S&P Global, increased to 54.8 points in May. with 51.3 points in the previous month – given in the second calculation. The initial estimate was 54.8 points.
US crude oil inventories last week increased by 1.23 million barrels, or 0.27 percent, to 455.92 million barrels. Gasoline stocks increased by 2.1 million barrels, or 0.92 percent, to 230.95 million barrels during this time. Reserves of distilled fuels, including heating oil, increased by 3.2 million barrels, or 2.68%, to 122.49 million barrels. On the oil market, WTI contracts for July increase by 1.24%. to USD 74.16 per barrel, and July Brent futures increase by 1.23%. up to USD 78.47/b.
