Stock market: Wall Street continues to rise, driven by technology

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MARKET REVIEW. The New York Stock Exchange, which started off lower, finally resumed its rebound on Friday, leading the previous day’s decline in US inflation.

The Toronto Stock Exchange continued to climb, gaining more than 120 points to close above the 20,000-point mark for the first time since August.

To (re)consult market news

Stock market indices at the close

In Toronto, the S&P/TSX increased by 121.15 points (+0.61%) to 20,111.51 points.

In New York, the S&P500 increased by 36.56 points (+0.92%) to 3,992.93 points.

The Nasdaq closed 209.18 points (+1.88%) at 11,323.33 points.

The DOW collected 32.49 points (+0.10%) to 33,747.86 points.

The loon up US$0.0045 (+0.5970%) to US$0.7548.

The oil to US$2.44 (+2.82%) to US$88.91.

L’gold up US$20.10 (+1.15%) to US$1,773.80.

The bitcoin down US$1,015.04 (-5.70%) to US$16,788.69.

The context

On Thursday, Wall Street happily celebrated a drop in inflation that raised hopes that rising US prices and perhaps Federal Reserve (Fed) interest rates would finally be on the rise.

Stock market indices posted their strongest daily gains since the start of the pandemic in spring 2020 on Thursday.

On Friday, the market continued to breathe “an understandable sigh of relief”, according to Tom Cahill of Ventura Wealth Management, as overall the stock market “remains well below its last peak”.

According to the S&P 500 index, the most representative of the American market, “when it fell to its lowest point, the market was 27% below its peak. It is still below 17%”, underlined the analyst.

Investors still expect the Fed to raise the monetary value by 50 basis points in December after four straight rate hikes of three-quarters of a percentage point (0.75%), ” but after we see what happens,” said Tom Cahill.

The bond market remained closed on the Veterans Day holiday and yields on the ten-year Treasury bill remained at 3.81% after falling sharply the previous day amid weaker inflation readings.

But this bond status quo has not prevented the dollar from continuing to fall against major currencies.

Falling dollar

By 3:40 pm, the greenback had fallen sharply by 1.48% against 1.0360 for one euro, a level not seen since the beginning of July. It also lost 1.78% against the yen at 138.53 yen to the dollar, falling back to the 140 yen threshold for the first time since early September.

“The decline in the dollar is favorable for American multinationals” part of which profits are made on exports, which also supported the shares on Friday, Tom Cahill reiterated.

The crypto sector remained jittery as troubled cryptocurrency exchange FTX filed for Chapter 11 bankruptcy protection on Friday.

Its owner and founder, Sam Bankman-Fried, 30, a multi-billionaire whose fortune evaporated in a matter of days, resigned.

“It’s too early to say that there won’t be another card that will fall,” the Ventura Wealth analyst feared.

“After all, everything is happening very fast and the crypto-asset industry was worth about $3 trillion earlier and is worth only $1 trillion now, so a lot of wealth has been destroyed,” he added – he emphasized that a number of investment funds have holdings in the sector.

Most S&P sectors ended in the green, especially energy (+3.06%), as crude oil prices rose following China’s announcement of easing its anti-corruption rules. -Covid for travelers, which could boost energy demand.

Communication services (+2.47%) and information technology (+1.72%) also finished higher, posting their best performance since April 2020 during the week.

The big names in technology continued their climb at a slightly more moderate pace than the day before, however, as Apple (AAPL, +1.93% to US$149.70), Alphabetthe parent company of Google (GOOGL, +2.63% to US$96.41) where Amazon (AMZN, +4.31% to US$100.79).

The technology was also driven by stocks from semiconductor manufacturers such as AMD (AMD, +5.70% to US$72.37) where Nvidia (NVDA, +3.66% to US$163.27).

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