Wall Street concludes at half mast, worried about geopolitical tensions and inflation

Geopolitical tensions and inflation depressed investors on the New York Stock Exchange which ended at half-mast on Friday, while banks launched the quarterly results season without success.

The Dow Jones index slipped 1.24% to 37,983.24 points, the technology-dominated Nasdaq fell 1.62% to 16,175.09 points and the broader S&P 500 index lost 1.46%. at 5,123.41 points.

“The fear factor came into play today,” commented Peter Cardillo of Spartan Capital. “The market is concerned about an extension of the conflict” in the Middle East, explained the analyst, stressing that intelligence information “affirms that Iran will respond to Israel this weekend”.

Iranian threats of attack against Israel are “credible” and “real”, a White House spokesperson said on Friday, as Iran threatened to “punish” Israel after the destruction of its consulate on April 1 in Damascus.

Faced with these concerns, investors rushed into safe stocks, especially in the first part of the session.

Gold hit a new record reaching $2,431.52 per ounce during the session, unprecedented, before closing down to $2,338.90. Since the beginning of March, the yellow metal has climbed around 18%. “We saw panic buying in gold at the start of the session,” admitted Peter Cardillo.

Another safe haven, the dollar climbed to its highest level since November against the euro, to 1.0639 dollars per euro around 7:40 p.m. GMT.

In the latest sign of anxiety for the region, oil prices soared to a peak since October, before losing ground.

Added to these geopolitical concerns were disappointing data from China, with a decline in exports of 7.5% over twelve months and 1.9% for imports.

On the market, the eleven sectors of the S&P remained deeply in the red.

Banks opened the earnings season, sparking mixed reactions.

JPMorgan, a member of the Dow Jones, posted profits up 6% in the first quarter, but the stock plunged 6.43% to $182.87, weighing heavily on the market. His boss Jamie Dimon warned of the pressures that inflation puts, exerting a “compression of margins”.

“Looking ahead, we remain on alert in the face of a significant number of uncertain forces,” he warned, citing in particular “a large number of persistent inflationary pressures, which could continue”.

Citigroup (-1.68%) published results lower than those of last year at the same time, down 27% over twelve months, but they remained higher than analysts’ forecasts.

Asset manager BlackRock saw the volume of assets under its control increase to $10.5 trillion (+15% over one year). The stock was however shunned by investors (-2.98%).

Wells Fargo Bank lost 0.32% after announcing a profit down 7% over one year to $4.6 billion, despite everything being higher than expectations. Turnover stood at $20.8 billion, a slight increase of 0.6%.

On the macro-economic front, the American import price index confirmed the tenacity of inflation: it climbed 0.4% over the month, the third monthly increase in a row.

Elsewhere, shares of semiconductor makers fell as China’s efforts to break away from dependence on U.S. chipmakers intensify. Intel fell by 5.16%, AMD by 4.23% and Nvidia by 2.68%.

Tesla dropped 2.03% to $171.05, several analysts having lowered their price targets and cited saturation in demand for electric vehicles.