Stock Markets Introduce Aviation Services Commencing Operations From Monday
The US stock exchanges exhibited a bullish trend after the holiday break, with the optimistic signals stemming from Europe, where stock markets celebrated the easing of trade tensions between the US and the EU the previous day. President Trump postponed the implementation of additional tariffs on EU imports until July 9, providing more time for negotiations on a trade agreement. This move has led investors to view US tariff threats as more of a negotiating tactic than a trade policy decision, reducing their impact on the financial market and allowing stocks to gain.
The Dow Jones Index surged by 1.8 percent to reach 42,344 points, while the S&P-500 and Nasdaq Composite rose by 2.0 and 2.5 percent, respectively. Preliminary data from the NYSE showed an increase of 2,411 gainers versus 380 losers. A total of 35 stocks remained unchanged. Additionally, data indicated a strong improvement in US consumer sentiment in May, with economist Stephanie Guichard of The Conference Board noting, "Consumer confidence improved in May after falling for five consecutive months."
In the bond market, the focus was on auctions of two-year Treasury notes and shorter-term securities. Market strategist Ahmad Assiri of Pepperstone commented, "Today's Treasury auctions are the ultimate test of supply." Despite initial concerns, demand for the two-year bonds remained solid, improving further on the secondary market and causing yields to drop. The yield on ten-year US Treasury notes fell 7 basis points to 4.44 percent, reflecting reduced rate cut expectations and increased confidence in US assets.
The dollar recovered from its recent losses with the Dollar Index gaining 0.4 percent. This improvement followed an agreement in the trade dispute with the EU and positive economic data, which helped ease recession fears and contributed to the minimal chances of rate cuts. The slump in Tesla sales in April by over 50 percent is notable but did not seem to impact the overall market sentiment.
On the other hand, the price of gold suffered, with the troy ounce losing 1.1 percent due to the increase in confidence in US assets. Similarly, oil prices fell by 1.0 percent, as the OPEC+ cartel is expected to discuss production increases at its weekend meeting. Market analyst Milad Azar of XTB MENA expects an increase of 411,000 barrels per day in July.
Anticipation is building for Nvidia, as a tech giant is planning to offer cheaper AI chips specifically for the Chinese market starting from June. This announcement helped Nvidia's stock rise by 3.2 percent. Additionally, Apple's stock showed significant strength, recovering most of Friday's losses, despite President Trump's threat of 25% tariffs on iPhones made in India. Trump insisted that only iPhones made in the US should be sold there.
Qualcomm has been given more time to make a firm offer for the acquisition of UK semiconductor manufacturer Alphawave IP Group. The deadline has been extended for the third time, now to Monday. Financial details were not disclosed, leading to a 2.2 percent increase in Qualcomm shares.
The Tesla stock gained 6.7 percent after Elon Musk stated he would focus more on leading his companies, citing that he is "super focused" on leading his companies. This announcement did not seem to be weighed down by the sharp decline in US electric vehicle maker's sales in Europe during April. Salesforce (+1.5%) is on the verge of a billion-dollar acquisition, aiming to acquire Informatica, a specialist in data management software, for around $8 billion. Eli Lilly (+1.6%) is also making an acquisition, planning to acquire SiteOne Therapeutics, a company specializing in pain treatment, for up to $1 billion. However, PDD Holdings (-13.6%) plummeted, with the parent company of Chinese online retailer Temu reporting a sharp drop in profits due to weakening demand in China.
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Sources: ntv.de, mau/DJ
Wall StreetTariffsConsumer sentiment
- Investors are less concerned about potential US tariff threats on EU imports, as they view them as more of a negotiating tactic than a trade policy decision, subsequently reducing their impact on the financial market and allowing stock-market gains.
- A community policy that addresses and eases trade tensions between the US and the EU has been instrumental in the optimistic trend exhibited by US stock exchanges, leading to an improvement in business sentiment and stimulating employment policies.
- To increase investments in technology, particularly in the production of AI chips for the Chinese market, companies are looking for strategies that align with their employment policies, which focus on efficient resource allocation and workforce management.
