Wall Street up for three sessions in a row, Birkenstock misses the mark

The New York Stock Exchange concluded in the green for a third session in a row on Wednesday for the Dow Jones, while remaining cautious before the release of American inflation on Thursday.

The Dow Jones index nibbled 0.19% to 33,804.87 points, the Nasdaq, with a strong technological coloring, gained 0.71% to 13,659.68 points and the S&P 500 advanced 0.43% to 4,376, 95 points.

Bond rates continued to fall, with ten-year rates reaching 4.56% compared to 4.65% the day before and 4.80% at the end of last week.

“The market closed higher despite a hotter than expected wholesale price index,” said Peter Cardillo of Spartan Capital.

The producer price index (PPI) in the United States rose another 0.5% in September, more than the +0.3% forecast, after already +0.7% in August.

“We will have the CPI consumer price index tomorrow Thursday. If annual inflation goes in the right direction, the upward trend on the stock market could continue while waiting for the banking results” which inaugurate the corporate results season, further indicated Peter Cardillo.

Investors also digested the minutes of the Fed’s last monetary meeting (“minutes”).

This shows that a majority of Fed members were in favor of another hike in key rates to fight inflation and that they agree to leave them high for longer.

“But these minutes date from before the conflict between Israel and Hamas,” noted the Spartan Capital analyst, “which is why the market did not react so much” to the rather hawkish tone of the Fed.

On the stock market, ExxonMobil lost 3.59% to 106.49 dollars with the announcement of the purchase of its compatriot Pioneer Natural Resources, for around 60 billion dollars.

The title of Pioneer, a large producer in the Permian basin in Texas, gained 1.44% to $240.82.

The two companies have highlighted their objective of accelerating the ambition of carbon neutral production in the Permian Basin for Pioneer from 2035, rather than 2050.

But they could attract the wrath of environmental defenders, at a time when calls to move away from fossil fuels are increasing around the world.

The automaker Stellantis was sought after (+3.42%) after announcing a $3.2 billion investment with Samsung SDI to build a battery factory for electric vehicles in Indiana.

Computer and printer maker HP (HPQ) shared strong estimates for its annual results, forecasting a 5% increase in its dividend. The stock gained 1.51%.

– Birkenstock on the stock market on the wrong foot –

The event of the day could have been the listing on the NYSE of sandals with large leather soles from the German manufacturer Birkenstock, but they missed the mark.

The stock with the ticker symbol “BIRK” closed at $40.20, 12.61% lower than the $46 price set for its IPO.

This flop on the first day of trading, rather rare for renowned companies, could deal a blow to the IPOS market still convalescing on Wall Street.

Birkenstock, which is owned by French luxury group LVMH while retaining a family stake, has generated sales of $1.11 billion over the past nine months.

“In 2021, the private equity firm L. Catterton and Financière Agache acquired a majority stake in Birkenstock, with a view to expanding into the Chinese market,” recalls Michael Hewson, of CMC Markets.

For Wall Street, the Birkenstock IPO is a new test, in an IPO market that is slowly recovering.

Last month, three new entrants made their mark: semiconductor designer Arm, grocery delivery platform Instacart and online marketing specialist Klaviyo. Only Instacart is currently trading below its IPO price.