Wall Street is doing better and ends higher
Wall Street ended up on Tuesday, March 29, welcoming the diplomatic progress on Ukraine, but with a more measured enthusiasm than the European markets.
The Dow Jones index gained 0.97%, signing its tenth increase in twelve sessions. The Nasdaq index, with a strong technological orientation, took 1.84% and the broader S&P 500 index, 1.23%.
This rise has several explanations including that of analysts Briefing.com, it is the “hopes of ceasefire (in Ukraine) that have stimulated the rise. There is a “positive momentum”, they wrote, in a note.
It took several hours of talks in Istanbul, Ukrainian and Russian negotiators indicated that diplomatic progress was sufficient to arrange a meeting between Ukrainian President Volodymyr Zelensky and Russian President Vladimir Putin.
In the aftermath, Russia promised to “drastically” reduce the intensity of its offensive on the capital Kiev and the Ukrainian city of Cherniguiv.
“In the U.S., the markets did not respond at the same level” as the European markets, “but it was a good catalyst to push the sliders higher,” commented Tom Cahill of Ventura Wealth Management.
The S&P 500 crossed the technical threshold of 4,600 points without batting an eyelid, a sign, for Tom Cahill, that there is still room for improvement.
In addition to Ukraine, “the market has come to terms with the idea that the Federal Reserve can achieve a soft landing for the economy,” he said, by raising rates without suffocating U.S. growth.
The VIX index, which measures market volatility, has fallen to its lowest level since mid-January, a sign that investors are less nervous.
On the bond market, however, rates experienced violent jolts. The yield on 10-year U.S. government bonds finally ended at 2.45%, compared with 2.39% the previous day, reflecting a shift to other asset classes, mainly equities.
It is normal that the bullish day benefited growth stocks, such as electric vehicle manufacturer Rivian (+17.18%), connected exercise bike specialist Peloton (+10.05%) or Uber (+6.96%).
The brokerage platform Robinhood even took off (+24.20% to 15.91 dollars), after announcing that it increased by four hours the daily time slot to make transactions, now between 07:00 and 20:00, with the objective, eventually, to allow continuous trading.
The Nasdaq and the giant capitalizations of the Nasdaq ended in the green, led by Apple (+1.91% to 178.96 dollars), which signed its eleventh consecutive rise and is now a breath away from 3,000 billion in valuation (2,921), a threshold already briefly crossed in early January.
Since the beginning of the COVID-19 pandemic, companies associated with travel such as cruise lines Norwegian (+3.12%), Carnival (+2.73%) and Royal Caribbean (+3.07%) have taken the lead, as well as airlines American Airlines and Delta Air Lines.
Nielsen (+20.31% to USD 26.72) jumped. The audience measurement firm agreed to be acquired by a consortium of investment funds, led by Evergreen Coast Capital Corporation. The deal values the firm at USD 16 billion, including debt.
The price is thus close to the price proposed by the consortium, i.e. 28 USD per share.
The FedEx company reacted calmly (+3.70% to 238.57 USD) to the announced step back of the founder Frederick Smith, who will give up the position of CEO on June 1st to keep only the position of executive chairman of the board of directors.
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