Stocks Fall on Wall Street as Chaotic May Ends
The stocks closed down on Tuesday. The market made small gains for May, ending a turbulent month. Concerns about a possible recession, inflation, and rising interest rates have broken Wall Street. The S&P 500 fell 0.6% and reimbursed the loss about half the day. The Dow dropped 0.7%. Nasdaq Composite by 0.4%. Both also estimated losses after falling by at least 1.4%.
Such fluctuations should probably come as no surprise given Wall Street’s actions this month, Against the backdrop of the wildest trade since the first days of the pandemic. The S&P 500 ended the month with less than a 0.1% gain. An 8.8% drop followed this in April. The index is now 13.9% behind the record set earlier this year. However, a minor move over the months denies a sharp drop down and up, which has shaken investors.
By mid-May, the S&P 500 had fallen for seven consecutive weeks, with its most extended such series; Since the dot-com bubble collapsed two decades ago. The slowdown in data on the U.S. economy has heightened concerns; That high inflation forces the Federal Reserve to raise interest rates so aggressively as to trigger a recession.
Some high-profile retailers have also said that inflation eats away at their profits. This adds urgency to the concern. They all banded together to bring Wall Street to what bears are called the edge of the market, Where the S&P 500 was on the verge of losing more than 20% above the record.
Stocks and Inflation
Strategists estimate that beyond the peace agreement in Ukraine, it is more difficult to set up a deal than a bear market share, which will only be a temporary reversal for the shares. They say the more stock prices rise, the more likely they will raise Federal Reserve interest rates.
The S&P 500 fell to 4,132.15, for a total of 26.09 points. The Dow lost 222.84 points to a total of 32,990.12. Nasdaq became up to 12,081.39. Small-company stocks make more sense than the broader market. Russell 2000 shrank by 1.3%, eventually reaching 1,864.04.
Oil prices rose slightly on Tuesday; After the E.U. agreed to block most of its oil imports from Russia; Because it invaded Ukraine. The benchmark price for U.S. crude oil fell 0.3% to $114.67 a barrel. Brent oil, by international standard, increased by 1%; The total was $122.84 per barrel.
This year, more than a 50% jump in oil prices has contributed significantly to very high inflation, which is raging worldwide. Earlier Tuesday, a report showed that inflation in the 19 countries that use the euro reached 8.1% in May. This is the highest rate since 1997. U.S. President Joe Biden met with Federal Reserve Chairman Jerome Powell; Because rising inflation continues to reduce American incomes.
The meeting was the first since Biden named Powell as head of the Central Bank, A few weeks after the Senate approved the second term. Biden said his plan for inflation starts with a simple proposition – respect the federation, respect the independence of the federal bank.
Fed Plans
The stocks managed to avoid a full-fledged bear market; Anyway, so far. The S&P 500 has not yet closed more than 20% below its record. The S&P has been the best week for 500 years and a half, partly hoping that inflation may reach a peak and begin to moderate. There has been growing speculation that the federation might consider halting interest rates at a September meeting. It has also helped ease restrictions on covid-virus in China. This has alleviated some of the worries about more worries about the world’s second-largest economy and global supply chains. In May, the activity of the Chinese factory decreased again but almost increased. More factories, stores and other businesses will open in Shanghai and Beijing this week; Since the government declared the epidemics under control. Shares in Shanghai and Hong Kong rose more than 1%.
Health, technology and energy supplies on Wall Street were one of the biggest problems in the market. UnitedHealth Group fell 2%, Chevron fell 2% Adobe fell 2.7%. Some areas of the stock market that has been particularly hard hit this year have also grown, Including Internet-related promotions. Amazon added 4.4%. Class A shares of Google’s parent company jumped 1.1%.
U.S. Treasury revenue increased; It has since shown that American consumer confidence was higher than economists expected. House prices rose more than forecast. The 10-year treasury interest rate has risen to 2.85%. Starting Wednesday, the Fed will begin issuing some trillion-dollar treasury and other bonds he accumulated during the pandemic to leave his balance sheet. Such a move would put upward pressure on the long-term outlook for Treasury revenues. It is also how the Fed is trying to stem inflation by slowing down the economy.
