“US Debt Ceiling Talks: Market Review and Closing Stock Prices”

2023-05-22 20:26:15

(Photo: Getty Images)

MARKET REVIEW. The New York Stock Exchange closed in mixed order on Monday as trading volume was modest pending further talks on the US debt ceiling.

The Toronto Stock Exchange was closed today for Victoria Day.

To (re)consult market news

Stock market indices at closing

In Toronto, the S&P/TSX is closed monday

In New York, the S&P 500 rose 0.65 points (+0.02%) to 4,192.63 points.

The Nasdaq rose 62.88 points (+0.50%) to 12,720.78 points.

The DOW dropped 140.05 points (-0.42%) to 33,286.58 points.

The loon retreated US$0.0003 (-0.0370%) to US$0.7406.

The oil rose by US$0.26 (+0.36%) to US$71.81.

L’or decreased by US$7.80 (-0.39%) to US$1,973.80.

The bitcoin rose by US$52.52 (+0.20%) to US$26,905.28.

The context

President Joe Biden and Kevin McCarthy, his main Republican opponent on the debt ceiling, were to resume negotiations after the close of markets on Monday to try to find a quick agreement and avoid a dangerous default in payment by the United States.

To give the green light to raising the country’s debt limit, Republicans want cuts in social spending. An agreement must be reached before June 1, otherwise, for the first time in its history, the United States risks defaulting on the repayment of Treasury bonds.

“The main driver of the market remains these ongoing talks in Washington which hopefully will avoid a default,” said Edward Moya of Oanda.

But for Spartan Capital’s Peter Cardillo, the market “isn’t really scared off by the rhetoric from Washington.” During a session with low volume, the Dow Jones tilted mainly weighed down by Chevron (CVX, -1,81%) et McDonald’s (MCD, -2,10%).

The oil company will buy PDC, a producer of crude oil and natural gas in Colorado and Texas, for 6.3 billion US dollars, more than 10% above the price of the action at the close on Friday.

Also a member of the Dow, Nike (NIKE) fell 3.97% as the stock’s rating was downgraded by analysts in the wake of the sports shoe retailer Foot Locker (FL) (-8,56%).

The S&P 500 and the Nasdaq concluded higher despite the uncertainties in Washington.

“I think investors are more focused on the monetary policy of the Fed,” said Peter Cardillo, noting that Neel Kashkari, a voting member of the Monetary Committee and chairman of the Minneapolis Fed, suggested that a pause in increases rate in June is possible.

“It’s pretty tight between the need to raise rates or pass the turn,” he said, with a more moderate tone than the week before.

It seems “the idea of ​​a break is spreading,” the Spartan Capital analyst concluded.

The semiconductor manufacturer Micron Technology (MU) fell 2.85% as China accuses the American group of having security failures and calls on companies to stop buying its chips. The United States responded, expressing “very serious concerns” about the sales restrictions, according to a State Department spokesperson.

When (WHEN) gained 1.09% despite a record fine of 1.2 billion euros from the Irish regulator imposed for breaching European data protection rules (GDPR) with its social network Facebook.

The videoconferencing specialist Zoom (ZM) which ended up 2.94% at US$71.41 was still up more than 5% in electronic trading after the close. The group announced quarterly results slightly above analysts’ forecasts.

In the morning, a brief episode of fake news tripped up the indices for a moment. A fake photograph relayed on Twitter showing an explosion at the Pentagon caused the market to dip slightly for ten minutes.

A Pentagon spokesman had to deny “the false information”.

“There was a downside to this misinformation when the machines picked it up,” noted Pat O’Hare of Briefing.com, referring to automated trading software that is programmed to react to network posts. social.

But the fact that this hollow remained measured in relation to the content of this false information suggests that some had already “deemed it muddy”, added the analyst interviewed by AFP.

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