Wall Street: the revival of cyclicals supports the trend
In late morning trading, the Dow Jones gained over 1% to 43,595.4 points, while the Nasdaq Composite was up 1.6% to 19,648.5 points.595.4 points, while the Nasdaq Composite gained 1.6% to 19,648.5 points.
This week is shaping up to be the best for US equity markets since the euphoria that followed Donald Trump's victory in the presidential election.
The Dow Jones, which had been on a two-week losing streak, posted a weekly gain of 3.8%, with the Nasdaq contenting itself with a more modest rise of 2.4%.
The stock market was buoyed by the easing of inflation worries following Wednesday's publication of a lower-than-expected consumer price index.
The trend also benefited from statements by Fed Governor Christopher Waller to the effect that the Fed could cut rates three to four times this year, provided indicators allow.
This climate of optimism particularly benefited cyclical stocks, as investors hoped that economic conditions would continue to improve.
The consumer sector (+2.1) was the best performer of the day, ahead of other growth-dependent segments such as raw materials (+1.1%) and industry (+0.8%).
Healthcare, down 0.1%, was the day's worst performer, as the Biden administration unveiled a new list of 15 drugs to be subject to price negotiations under the Medicare health program.
On the statistics front, the Commerce Department this morning reported a 15.8% jump in housing starts in December, reflecting a much-improved housing market.
On the bond front, Treasuries yields are stabilizing, especially long-dated ones such as the ten-year, which is hovering around 4.61%, a far cry from the peak of 4.80% reached at the start of the week.
Oil, whose surge has been one of the highlights of the early part of the year, is consolidating but still remains close to the highest levels since last summer.
U.S. light crude (West Texas Intermediate, WTI) is currently down 0.8% at $78, but remains on course for a fourth consecutive week of gains, with weekly gains of nearly 2%.
It should be noted that this is a "three witches" day, marked by the expiry of numerous options contracts, which could tend to increase volatility at the end of the session.
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