Rates fall and Wall Street closes higher, the S&P at a record

The New York Stock Exchange ended Monday much better than it started, pushing the broader S&P 500 index and the Dow Jones to new records, helped by a decline in bond yields.

The Dow Jones gained +0.59%, reaching a high of 38,333.45 points, the technology-dominated Nasdaq gained 1.12% to 15,628.04 points and the broader index advanced 0.76%. , a new historic high at 4,927.93 points.

The decline in bond rates significantly boosted stocks in the second part of the session when yields on government bonds fell after an announcement from the Treasury Department that it plans to borrow less than anticipated.

“The Treasury published an estimate of its financing needs in the first quarter of only 760 billion dollars, compared to 816 billion previously,” underlined Karl Haeling of LBBW.

Ten-year rates thus fell to 4.08% compared to 4.13% the day before. Two-year short rates fell to 4.32% from 4.34%.

Given the debt situation of the United States and the standoff that this causes in Congress, this borrowing estimate “was an element closely monitored by investors as being a source of concern”, commented Angelo Kourkafas, strategist in investment for Edward Jones.

“The lifting of this concern has nicely pushed up the bonds (which lowers their yield) and pushed up growth stocks”, notably those in the technology sector which will publish their results this week, added the specialist.

Thus the shares of Microsoft (+1.43% to $409.72) and Meta (+1.75% to $401.02), whose results are expected on Tuesday and Thursday respectively, reached new heights.

The exchanges were also characterized by a flight from risk, reported Peter Cardillo of Spartan Capital, while we await an American response to the death of three American soldiers in Jordan.

This lack of risk appetite in view of the potential escalation of the geopolitical situation “was seen in the dollar” (+0.19% against the euro around 9:25 p.m. GMT) and in bond purchases, added the analyst.

In addition, investors are awaiting the outcome of a monetary meeting of the US central bank (Fed) on Wednesday and hoping to have clues on the timing of future rate cuts.

Elsewhere on the stock market, Boeing (-0.14%) held its ground as the aircraft manufacturer published its results on Wednesday after going through a turbulent period.

The shares of the iRobot group collapsed by 8.77% to 15.50 dollars after Amazon announced that it was abandoning the acquisition of the manufacturer of intelligent vacuum cleaners, the European Commission having opened an investigation to assess the impact of this acquisition on competition. The company also announced a restructuring plan with the elimination of 350 jobs.

Amazon gained 1.34%.

The shares of JetBlue (-0.54%) and Spirit (-3.52%) continued their ups and downs in the wake of the merger project blocked by a judge in the name of respect for competition.

The personal finance platform Sofi Technologies was highly sought after (+20.21% to $9.16) after posting a quarterly profit for the first time thanks to growth in its lending activity.

The company also saw its deposits increase six-fold to $18.6 billion in the quarter. The company forecasts earnings per share of between 7 and 8 cents for 2024, when analysts were betting on 5 cents.

In finance, Affirm, the deferred payment specialist, climbed almost 6%.