Wall Street ends lower, Congress and corporate earnings worry

The New York Stock Exchange ended lower on Thursday and punctuated a difficult September on a gloomy note, concerned about congressional procrastination as well as disappointing corporate results.

The Dow Jones closed down 1.59% at 33,843.92 points, the Nasdaq index, with strong technological representation, down 0.44% to 14,448.58 points and the extended S&P 500 index, 1 , 19% at 4,307.54 points.

The three major indices of the New York Stock Exchange ended the month of September lower, marked by a few drops under the effect in particular of the Evergrande file and then the acceleration in interest rates.

The Dow Jones lost 4.2% in September, while the Nasdaq was down 4.7% and the S&P 500 5.3%.

After starting up on Thursday, the indices have all, at one time or another, gone into the red, cut off in their little impetus by a leaden atmosphere, on both macro and microeconomic levels.

“There are a couple of things the markets are concerned about,” said Tom Cahill, head of portfolio strategy at Ventura Wealth Management, “the most important being the situation in Washington.”

Congress nevertheless made progress on Thursday, with the vote of a measure to finance the government until the beginning of December. This leaves more time for Democrats and Republicans to agree on raising the US debt ceiling, the specter of which continues to hang in the markets.

In addition, the Senate adopted the infrastructure investment plan, presented by the Biden government, in the amount of $ 1.2 trillion.

The Democratic President of the House of Representatives, Nancy Pelosi, announced her intention to submit the same text to a vote in the lower house this Thursday also, despite the reluctance of certain progressive elected officials from her own camp.

Operators are also “troubled” by the disappointing, even alarming, publications of several companies, said Tom Cahill.

The chain of home equipment stores Bed Bath & Beyond has thus unscrewed (-22.14% to 17.28 dollars) after the publication of a net loss in the second quarter of its staggered fiscal year (from June to May) , while analysts expected a profit.

The group says it suffered from a slowdown in footfall to its stores in August due to the resurgence of the Delta variant of the coronavirus, as well as a surge in its costs.

Another notable publication, that of the used car dealer CarMax (-12.61% to 127.98 dollars) whose quarterly net profit came out below expectations.

The turnover is however higher than forecasts and the sales of used cars, boosted by the pandemic, continue to increase (average price of a vehicle up by 31%).

In the case of the McCormick agri-food group (-3.18% to 81.03 dollars), owner of the Ducros brand, the market did not hold so much profit or turnover, both above expectations, as the discourse on prices, in terms of supply but also of sales.

The group has revised downwards its operating profit target for the 2021/22 financial year (from June to May), due to “uncertainty as to the evolution of costs”.

On the same refrain, the department store chain Kohl’s (-12.24% to 47.09 dollars) fell after a lowering of the recommendation by analysts at Bank of America, worried about the group’s supply problems. Its competitor Macy’s fell sharply (-8.50% to 22.60 dollars), in its wake.

These supply issues and persistent rising costs “could become a problem,” Cahill warns, “not just because they are going to show up in the third quarter results,” which was widely anticipated, but ” because we’re entering the fourth quarter and things don’t look like they’re going to get better anytime soon. ”

Still on the table of values, the tobacco companies Philip Morris International (-4.72% to 94.79 dollars) and Altria (-6.61% to 45.52 dollars) have badly lived the ban, pronounced Wednesday by the International Commission for commerce (ITC), to import into the United States their heated tobacco devices, also known as IQOS.

In the bond market, ten-year US government bond rates eased slightly to 1.50% from 1.53% on Wednesday.

tu / vmt / bt

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