US: Wall Street stocks still in the red

Today, after a volatile but hopeful start for investors, there is an air of tension on Wall Street, with the Nasdaq, the S&P 500, and the Dow Jones all registering losses. 

Wall Street stocks register losses across the board

The Dow Jones loses 0.14% to 30,274.80 points, the Nasdaq falls 0.25% to 11,148.64 points while the S&P 500 drops 0.19% to 3,783.65 points.

Losses in the small-cap sector have affected smaller companies by capitalization mainly because of the difficulty in finding raw materials at competitive prices and the impact of energy bills. 

On the other hand, as for the S&P 500 and Nasdaq, which are made up of apex companies, losses stemmed mainly from export-related problems and rising fuel costs. 

As mentioned above, a strong currency creates problems for companies that export products to countries with weaker currencies. 

In the case of US companies, the problem is of great importance because in the basket of companies listed on the two major indexes, 60-70% of earnings are derived from exports.

On the energy side, there certainly was no helping hand extended by Opec, which at yesterday’s meeting sanctioned a decrease in daily production of 2,000 barrels of crude oil. 

The decision contradicts the fight against high gasoline/diesel prices but serves the interests of oil companies as one would expect. 

Against a backdrop where uncertainty and fear hover among investors comes bad data on the propensity of American households to save and consequently partly to invest. 

From post-pandemic to the present it has gone from a savings propensity value of 10.5 to just 3, a sign that American households are managing to set aside 70% less than they managed just after the pandemic crisis. 

Despite this, private employment data are reassuring, rising much more than expected in September, 208,000 jobs compared to forecasts of 200,000.

Among the major tech stocks, Tesla drops 3.46% to $240.81, Apple remains essentially stationary (AAPL) at $146.40, Amazon (AMZN) loses 0.12% to $120.95, Google 0.21% and Netflix 1.67% to $236.73 a share. 

Analysts are torn as to whether the green of the last few days seen on the stock exchanges is a flash in the pan or the beginning of a trend that will be sustained over time, brushing aside for now the word “bull run,” some think recoveries are nevertheless possible in the short term (maybe a couple of weeks) just enough time to save some quarterly reports. 

European stock markets similarly in crisis

Broadening the view into the international arena, things are no different as yields in Europe on bonds are back on the rise with rates on the Bund above 2% and those on the BTp at 4.4 %, the Spread is also back as it is above 240 basis points. 

On the old continent, the worst is Milan along with Madrid (IBEX 35), all other stock exchanges, Frankfurt (DAX 30), London (FTSE 100) and Paris (CAC 40) are also losing.