Major indices in the New York Stock Market rose as US Treasury yields fell back and expectations for large-scale infrastructure investments increased.
On the 22nd (US time) on the New York Stock Exchange (NYSE), the Dow Jones 30 Industrial Average closed at 32,731.20, up 103.23 points (0.32%) from the battlefield.
The Standard & Poor’s (S&P) 500 index closed at 13,377.54, up 27.49 points (0.7%) from the battlefield at 3,940.59, while the tech stock-oriented Nasdaq index rose 162.31 points (1.23%) to 13,377.54.
The market kept an eye on US interest rate trends, key economic indicators, and news about the US infrastructure investment bill.
The stock market was supported by the decline in the 10-year Treasury bond yield, which exceeded 1.7% last week.
The 10-year U.S. Treasury bond yield was limited to fluctuating on the same day, reaching about 1.69% at the close of the stock market.
Technology stocks responded positively as rising interest rates increased the valuation burden of overvalued technology stocks.
Tesla’s share price rose more than 2.3%, and Apple’s share price rose more than 2.8%.
Economically sensitive sectors, such as industrial stocks, were relatively sluggish at the beginning of the market, but then rebounded successfully.
It was fueled by the news of the U.S. government’s large-scale infrastructure investment.
The New York Times (NYT) cited sources and reported that President Joe Biden’s advisors will report to the president this week a $3 trillion infrastructure investment bill.
Advisors are known to propose a plan to divide the $3 trillion bill into two branches.
Expectations have risen rapidly that infrastructure investments larger than the market’s forecast of about $2 trillion will be pushed forward.
Heavy equipment maker Caterpillar’s share price turned upward after a downtrend, providing a boost to infrastructure-related companies’ share prices.
However, the stock prices of banks such as JPMorgan Chase and Bank of America continued to be sluggish.
Jerome Powell, chairman of the Federal Reserve System (Fed), attended a seminar hosted by the International Settlement Bank (BIS), but did not comment on the economic situation and monetary policy.
Chairman Powell evaluated that the current virtual currency is a speculative asset, not a means of storing value.
He added that the digital dollar would not be introduced without widespread support, including congressional approval, and that it was not in a hurry.
The next day, Chairman Powell will testify in the US House of Representatives on the economic policy to respond to the pandemic.
News has been mixed regarding the novel coronavirus infection (Corona 19).
AstraZeneca announced that the vaccine’s preventive effect recorded 79% in its tertiary clinical trial in the United States.
The effect of preventing severe symptoms reached 100%.
It also showed that the vaccine did not increase the risk of clot formation, the company said.
AstraZeneca vaccine has sparked controversy, such as the temporary suspension of vaccination in some European countries due to concerns about side effects.
On the other hand, in Europe, the situation is worsening, as Germany and France have again imprisoned the blockade due to the rapid spread of the mutant virus.
There are concerns about a disruption to the normalization of the economy in Europe.
On this day, by industry, technology stocks rose 1.93%.
Financial stocks fell 1.3%, industrial stocks fell 0.1%.
Although the US economic indicators for February released on the day were sluggish, they did not have a significant impact on the market as it was interpreted as being affected by unusual weather such as cold waves and heavy snow.
The Federal Reserve Bank of Chicago announced that the US activity index in February was negative (-) 1.09, down from 0.75 last month.
This is the first negative number since April of last year.
The expert’s estimate of 0.68, compiled by the fact set, was also significantly lower.
The National Real Estate Brokers Association (NAR) announced in February that existing home sales (seasonal adjustments) fell 6.6% from the previous month to an annual rate of 6.2 million units.
It was less than 6.5 million units, a 2.8% decline in the market forecast.
New York stock market experts diagnosed uncertainty arising from rising US interest rates could lead.
Edward Smith, head of asset allocation research at Rathbone Investments Management, said, “The possibility of a rise in US interest rates is greater than the possibility of a decline.”
He added that although resistance to rising interest rates in major tech stocks has grown in recent years, attention to higher valuations is still needed.
According to the Chicago Merchandise Exchange (CME) Fed Watch, the FF interest rate futures market is as of 25bps in September.
We reflected the possibility of an interest rate hike by 2.2%.
On the Chicago Options Exchange (CBOE), the volatility index (VIX) recorded 18.88, down 9.88% from the previous trading day.
/yunhap news