US stock markets sneak into positive territory
Independence Day and new labor market data were expected to result in a subdued trading day on Wall Street, but things turned out differently. In particular, automobile stocks caused significant swings, nearly reaching new record highs.
At the US exchanges, the trend was cautiously upward throughout the day. Observers had anticipated a sideways movement due to limited trading on Independence Day on the Wednesday and no trading at all on Thursday. However, the trend continued to move upward, especially the technology-heavy Nasdaq Indices.
The Dow Jones Index rose 0.4 percent to 39,372 points. The S&P 500 improved by 0.6 percent, while the Nasdaq Indices gained up to 1.0 percent and missed new record highs by a narrow margin. On the NYSE, there were 1,850 (Monday: 887) winning stocks and 971 (1,926) losing ones. 55 (62) titles remained unchanged.
Bond yields retreated slightly after the upward trend of the previous days, dampening the mood for equities. While the number of job openings in the US was higher than expected in May, indicating a robust labor market and arguing against falling interest rates, Federal Reserve Chair Jerome Powell at the ECB Central Bank Symposium in Sintra stated that inflation, which had risen sharply at the beginning of the year, was now on the decline. Whether this would justify a rate cut, he did not say. "We want to be more confident that inflation will sustainably move lower before we begin easing policy," he only emphasized. The likelihood of a rate cut in September currently stands at around 70 percent, slightly higher than the previous day.
At the currency market, there was little movement, with the Euro last traded at 1.0745 Dollars. Oil prices stagnated after the strong increase from the previous day to their highest level in over two months. Participants spoke of profit-taking.
Tesla, Rivian, and Nikola with strong stock gains
Auto stocks were the clear winners of the day. Their S&P sector index jumped over 8 percent. The Tesla stock built on its strong gains from the previous day, reaching its highest level since mid-January, with a 10.2 percent increase. The electric car pioneer reported better-than-expected sales for the second quarter, although sales were down quarter over quarter. Tesla also managed to outpace its sharpest rival BYD again, even though BYD increased its deliveries.
Rivian raised its sales by 9 percent year over year more strongly than expected. The production decrease compared to the previous quarter did not concern investors. Rivian gained 7 percent. Nikola surged 8.6 percent higher. The manufacturer of hybrid trucks exceeded its own expectations for the second quarter with 72 deliveries compared to 60. Polestar Automotive, on the other hand, lost 1.2 percent. The company reported an operational loss in its first quarter.
GM (+0.6%) gained little from the automaker's announcement of the best quarterly sales since several years. Electric vehicle sales jumped 40 percent, but still made up only a small portion of total sales.
Pharmaceutical stocks were sold off. US President Joe Biden and Senator Bernie Sanders had urged Danish pharmaceutical company Novo Nordisk to significantly lower prices for Wegovy and Ozempic, blockbuster medications for obesity and Type-2 diabetes. Simultaneously, they called for an expansion of the Medicare program for negotiating drug prices. Eli Lilly reduced prices by 0.8%, Pfizer by 1.4%, and Merck & Co by 0.1%. The US Food and Drug Administration's approval of Eli Lilly's Alzheimer's medication at most slightly affected the stock.
Tempur Sealy increased by 2.4%. The US Antitrust Authority blocked Tempur Sealy's planned acquisition of Mattress Firm for $4 billion. Tempur Sealy CEO Thompson had mentioned considering stock buybacks should the deal not go through.
Paramount Global rose by 5.7%. According to the "New York Times," billionaire Barry Diller is reportedly considering an acquisition offer.
Everything else about today's stock market developments can be found here.
Despite the anticipation of a subdued trading day on Wall Street due to Independence Day and limited trading, the Dow Jones Index managed to rise 0.4%, reaching 39,372 points. The significant swings in share prices, particularly in the automobile sector, were a notable highlight during this time, with Dow Jones & Company-related shares playing a key role.
