Wall Street starts above parity, but T-Bond rate rises
15 / April / 22 Visitors: 19 ★★★★★
The start is above parity for Wall Street indices, which are regaining peace of mind after yesterday's words of Fed Chairman Jerome Powell, who feared a more aggressive tightening of monetary policy than previously expected in order to slow down the inflationary peak. The Dow Jones is starting to trade 0.7% higher, while the S&P 500 is up 0.7% and the Nasdaq is up 0.7%. On the other hand, the yield on ten-year Treasury bonds is rising again, reaching 2.38%.
"Caught between an anvil and a hammer, the Fed sees no choice but to try to reduce inflation by raising interest rates even more this year if price pressures continue to rise," says Suzanne Streeter, an analyst at broker Hargreaves Lansdown. "Concern about how far and how fast the Fed will go has not yet turned into a real rage in the bond markets, but treasury bonds have fallen in price and yields have risen, which indicates that concerns are growing," he adds.
Markets continue to react to the development of peace talks between Russia and Ukraine. "While the war remains arguably the most important news right now, the central bank's comments have dominated the market agenda," said Jim Reed, strategist at Deutsche Bank. On the negotiating front, Kiev seems unwilling to recognize the capitulation of the city of Mariupol to the armed forces of Moscow. President Vladimir Zelensky has unequivocally stated that his country will fight "to the end."
European markets were also positive, due to the good performance of banks and financial securities, which are well exposed to any increase in interest rates. FTSE Mib rose by 1%, Dax by 0.8%, Cac by 1%, Stoxx 600 by 0.6% and Ftse 100 by 0.5%. Oil is recovering slightly: WTI falls to $111 per barrel, Brent is just below $115. Gold in a moderate decline to $1,923 per ounce, bitcoin rose sharply above $ 43,000. The euro is recovering against the US dollar at the intersection of 1.1028, the Btp-Bund spread is growing to 153 basis points.