MARKETS USA / Wall Street firmer – investors hope for economic recovery 20.05.20

NEW YORK (Dow Jones) – Wall Street showed up again after the breather on the previous day at midweek. The US stock exchanges were boosted by good company figures. Some retailers in particular had performed surprisingly well despite the corona crisis because consumers did not cut spending as drastically as feared. Private consumption is the cornerstone of the US economy.

However, the tensions between the United States and China came to the fore again, which caused the prices to return from their daily highs: The US Senate voted for a law that Chinese companies that are listed on the US stock exchange or that are seeking to be listed there, should force to abide by the US securities laws. However, the bill still needs to be approved by the House of Representatives before it is presented to the US President for signature.

The Dow Jones index rose 1.5 percent to 24,576 points, the S&P 500 increased 1.7 percent, while the Nasdaq composite gained 2.1 percent. The 2,330 (Tuesday: 1,141) course winners were matched by 625 (1,801) losers. 51 (65) titles closed unchanged.

There was hardly any news about the corona pandemic. The euphoria about advances in a possible coronavirus vaccine, which had contributed to a buying rally earlier in the week, has subsided, also because the US health website Stat News has raised doubts about the effectiveness of the Moderna vaccine. Moderna had already said that the vaccine caused an immune response in some subjects, but not in all. The Moderna share now rose by 2.5 percent after Tuesday’s reset.

In view of the global recessive consequences of the corona pandemic, there was still a degree of uncertainty among investors. It is assumed that the economic recovery phase will probably take longer than some originally expected. Investors therefore continue to rely on central banks and government stimulus programs.

The minutes of the Fed meeting on 28 and. April 29, which was released on Wednesday, did not set any accents. Monetary watchdogs were increasingly concerned about the consequences of the corona crisis and confirmed plans to keep the key interest rate close to zero percent. Federal Reserve chief Jerome Powell recently reiterated at his Senate hearing on Tuesday that the Fed would use all the means at its disposal to support the US economy.

Falling inventories support oil prices

Oil prices rose after the U.S. Department of Energy surprisingly reported a decrease in its oil reserves. The price of the US variety WTI rose 4.8 percent after the contract change to $ 33.49. The European reference variety Brent rose by 3.2 percent per barrel to $ 35.75.

gold rose 0.3 percent to $ 1,750 per troy ounce. Government bonds were in demand again. The yield on ten-year US government bonds fell 1.1 basis points to 0.68 percent as prices rose.

On the foreign exchange market, the euro expanded its gains against the dollar. Most recently, the common currency received tailwind from plans by Germany and France for a EUR 500 billion EU reconstruction fund. The euro was trading around $ 1.0980 in late US trade, versus 1.0928 on Tuesday evening.

Lowe’s benefits from online business

The pharmaceutical company Johnson & Johnson is taking baby powder, which is controversial due to possible cancer risks, from the market in the USA and Canada. As part of a general review of the product range against the background of the corona crisis, it was decided to stop selling the baby powder and around a hundred other products in North America, the US company said on Tuesday. In other countries, where the demand for the baby powder is “significantly higher”, it should continue to be offered. The stock fell 0.9 percent.

Lowe’s improved 0.1 percent. The hardware store chain got through the first quarter better than analysts expected. Lowe’s boss Marvin Ellison said customers had bought more online because of the pandemic. Here, sales increased by 80 percent. However, due to the uncertain outlook, Lowe’s canceled the annual forecast. Turnover had risen well in May, too, but how the year went was not predictable due to the pandemic.

Urban Outfitters was down 7.8 percent. The clothing retailer sank to the loss zone in the first quarter. For the second quarter, CEO Richard Hayne warned of a decline in sales of possibly over 60 percent. For example, stores in North America saw a 65 percent drop in customer traffic.

Despite a weak outlook, McKesson stocks advanced 1.2 percent as the company outperformed in the fourth quarter. The distributor of pharmaceutical products and medical equipment warns of “challenges” from the Covid 19 pandemic. However, McKesson does not believe that a second wave of Covid 19 cases will lead to new measures that prevent patients from using health services and pharmaceutical products.

Inovio rose 8.5 percent. The company’s coronavirus vaccine candidate has elicited immune responses in mice and guinea pigs.

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INDEX last +/-% absolute +/-% YTD

DJIA 24,575.90 1.52 369.04 -13.88

S & P-500 2,971.61 1.67 48.67 -8.02

Nasdaq Comp. 9,375.78 2.08 190.67 4.49

Nasdaq-100 9,485.02 2.01 186.48 8.61

US bonds

Maturity yield bp to vt yield vt +/- bp ytd

2 years 0.17 1.2 0.16 -103.3

5 years 0.34 0.8 0.33 -158.6

7 years 0.53 0.7 0.52 -171.9

10 years 0.68 -1.1 0.69 -176.1

30 years 1.41 -0.3 1.41 -165.9

CURRENCIES last +/-% Thu, 8:21 Tue, 17:32% YTD

EUR / USD 1.0977 + 0.51% 1.0943 1.0928 -2.1%

EUR / JPY 118.06 + 0.34% 117.93 117.98 -3.2%

EUR / CHF 1.0594 -0.16% 1.0612 1.0625 -2.4%

EUR / GBP 0.8976 + 0.63% 0.8937 0.8926 + 6.1%

USD / JPY 107.56 -0.17% 107.76 107.96 -1.1%

GBP / USD 1.2230 -0.13% 1.2245 1.2244 -7.7%

USD / CNH (offshore) 7.1057 -0.19% 7.1173 7.1133 + 2.0%

Bitcoin

BTC / USD 9,517.51 ​​-1.71% 9,788.76 9,715.01 + 32.0%

ROHOEL last VT-Settl. +/-% +/- USD% YTD

WTI / Nymex 33.64 31.96 + 5.3% 1.68 -42.9%

Brent / ICE 35.88 34.65 + 3.5% 1.23 -43.5%

METALLE last day before +/-% +/- USD% YTD

Gold (spot) 1,749.49 1,745.10 + 0.3% +4.39 + 15.3%

Silver (spot) 17.54 17.40 + 0.8% +0.14 -1.7%

Platinum (spot) 843.70 835.25 + 1.0% +8.45 -12.6%

Copper future 2.46 2.42 + 1.6% +0.04 -12.7%

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Contact the author: [email protected]

DJG / DJN / cln

(END) Dow Jones Newswires

May 20, 2020 16:11 ET (20:11 GMT)

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