Wall Street opens sharply after good bank results

Wall Street opens sharply after good bank results
Wall Street opens sharply after good bank results

New York (AFP)

The New York Stock Exchange opened sharply higher Thursday after a burst of strong banking results and a decline in weekly claims for unemployment benefits in the United States.

At 2:15 p.m. GMT, the Dow Jones climbed 1.07%, the Nasdaq 1.40% and the S&P 500 climbed 1.21%.

The day before, after a volatile session marked by the announcement of an acceleration in US inflation, the Dow Jones index had remained in equilibrium at 34,377.81 points.

The Nasdaq, with strong technological coloring, had gained 0.73% to 14,571.63 points, while the S&P 500 had advanced 0.30% to 4,363.80 points.

“US stocks are trading nicely higher early in the session, after a slew of reports on financial sector earnings as the third quarter earnings season kicks off,” Schwab analysts said with satisfaction.

Other good news on the macroeconomic front, “weekly jobless claims fell more than expected to fall for the first time below the 300,000 mark since the start of the pandemic,” they also noted. Between October 3 and 9, 293,000 people registered as unemployed, 36,000 less than the previous week.

“This is a clear and welcome drop that brings the level of applications for benefits closer to the average of 218,000 observed in 2019,” noted Rubeela Farooqi, chief economist for HFE, who forecasts a continuous decline in these weekly jobless claims.

To this we had to add a wholesale price index for September weaker than expected at + 0.4% over the month against projections of + 0.6%. Over one year, however, the producer price index in the United States climbed to + 8.6%, the largest increase since 2010.

Among stocks, bank securities were in demand after good results boosted by the reduction in reserves built up at the start of the pandemic.

Bank of America (+ 2.09% to 44.04 dollars) saw its profit jump 58% in the third quarter, helped by the improvement in the economy which allowed it to reduce these reserves. Its net profit reached $ 7.69 billion.

Despite a 48% increase in the third quarter for Citigroup, reaching $ 4.6 billion, the company’s stock fell slightly (-0.43% to $ 70.02) as its volume of loans granted is in decrease.

After an initial jump, the stock of US investment bank Morgan Stanley fell 0.56% to 98 dollars after the bank announced results above expectations.

The group posted a net profit of $ 3.71 billion from July to September, up 36% from the same period last year.

Aircraft maker Boeing lost 1.03% to $ 219.57 after confirming Thursday that a manufacturing defect had been detected on its long-haul 787 Dreamliner, a model already affected by a series of technical issues.

The bond yield on 10-year Treasury bills eased slightly to 1.52% from 1.53% the day before.

© 2021 AFP

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