Last night, major indices on the New York Stock Exchange rose on the first trading day of the second half of the year despite concerns about a recession.
At the New York Stock Exchange (NYSE) on the 1st (local time), the Dow Jones Industrial Average stood at 31,097.26, up 321.83 points (1.05%) from the previous day. The Standard & Poor’s 500 Index rose 39.95 points (1.06%) to 3,825.33, up 39.95 points (1.06%) from the battlefield, and the Nasdaq index, which focuses on technology stocks, closed at 11,127.85, up 99.11 points (0.90%) from the battlefield.
The S&P 500 fell 20.6% in the first half of this year alone. This is the biggest decline since 1970.
S&P Global’s ‘US Manufacturing Purchasing Managers’ Index (PMI)’ released on the same day recorded 52.7. This is a sharp decline from the previous month (57.0) and is the lowest level since July 2020.
The PMI for June announced by the Association for Supply Management (ISM) also fell to the lowest level in two years. ISM’s manufacturing PMI for June was 53.0. It fell from the previous month (56.1) and recorded the lowest level since June 2020 (52.4). It also fell short of analysts’ expectations (54.3) compiled by the Wall Street Journal.
The Atlanta Federal Reserve’s second-quarter gross domestic product (GDP) forecast also fell. According to the GDP Now model of the Atlanta Fed, the forecast for the US 2Q GDP growth rate was negative (-) 2.1% as of the 1st. It fell further from -1.0% the previous day. If the US growth rate in the second quarter falls to negative levels, a recession will become a reality.
The 10-year U.S. Treasury yield fell below 3%. It fell to 2.79% during the day. In the Treasury bond market, prices are rising and interest rates are falling rapidly, reflecting concerns about an economic downturn. As fears of a US economic slowdown grow, some are predicting that the Fed may end tightening sooner or cut interest rates sooner than expected.
All 11 sectors in the S&P 500 rose, and utilities, consumer discretionary, real estate, energy, finance, consumer staples, and health-related stocks all rose more than 1%.
According to the Chicago Mercantile Exchange (CME) FedWatch, the probability that the Fed will raise rates by 0.75 percentage points at the July meeting in the Federal Funds (FF) interest rate futures market is 83.8%, slightly higher than the previous day (82.6%).
The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) recorded 26.70, down 2.01 points (7.00%) from the battlefield.
Shin Yong-hyun, reporter at Hankyung.com [email protected]