Wall Street opens higher, resists rise in bond rates

The New York Stock Exchange opened higher on Monday, confident in the trajectory of the American economy and calmly welcoming a new rise in bond rates. Around 1:55 p.m. GMT, the Dow Jones gained 0.19%, the Nasdaq index gained 0.12% and the broader S&P 500 index gained 0.05%. “Bond rates continue to rise,” said Peter Cardillo of Spartan Capital. “The fear that the Fed will not lower its rates at all this year is becoming more present.”

Operators now attribute the same probability to the hypothesis including two rate cuts by the American central bank (Fed) in 2024 as to the one which predicts three, a first. The yield on 10-year US government bonds rose to 4.46%, a level it had not seen since the end of November. “But for the moment, it seems that the bond market is more worried about the number of rate cuts than the stock market,” noted, in a note, Patrick O’Hare, of Briefing.com.

On Friday, investors welcomed the high figure of 303,000 job creations in March, significantly higher than the 200,000 expected by economists, seeing it as a new illustration of a vigorous economy. “High rates do not rhyme with a rising stock market,” nevertheless warns Peter Cardillo, for whom “investors will remain cautious” before the significant milestones of the week. The New York market is notably awaiting the publication, on Wednesday, of the CPI price index, which economists see rebounding slightly in March compared to the previous month, to 3.4% over one year against 3.2% previously.

Results season kicks off on Friday

The CPI will be followed on Thursday by the PPI producer price index, considered a leading indicator of inflation. The week will also see the start of the results season on Friday with a first round of financials, from JPMorgan Chase to Citigroup, including Wells Fargo and BlackRock. In terms of values, the context of high rates benefited banks, notably JPMorgan Chase (+0.56), whose CEO, Jamie Dimon, published his letter to investors on Monday, in which he indicated that he could not rule out a new surge. of the cost of money. Micron (+0.70%) is still riding on a note from a Citi analyst, published Friday, who sees the Boise (Idaho) group as one of the best positioned in the race for artificial intelligence, notably thanks to to its expanded bandwidth chips.

The Taiwanese semiconductor giant TSMC, listed in Taiwan but also on the New York Stock Exchange, gained 2.07% after the American government’s commitment to allocate $6.6 billion in subsidies for the construction of a third site in Arizona. MicroStrategy, specializing in remote computing (cloud computing), soared (+9.18%) after a favorable note from the investment bank Benchmark regarding this company considered to be the non-financial company holding the most of bitcoins in the world.

For Benchamrk, MicroStrategy should take advantage of the “halving”, an imminent event which will halve the reward awarded to the creators of bitcoins, the “miners”, and slow down the generation of new units of this digital currency. Bitcoin gained 3.73%, to $71,904, and was getting closer to its historic peak, recorded in mid-March, or $73,797.98. Tesla accelerated (+4.21%) after its boss Elon Musk announced the presentation, at the beginning of August, by the manufacturer of a robotaxi.