HoonSmart.com>> US stock market, 3 main indexes closed down. The Dow Jones Index dropped 375 points after reporting lower-than-expected 1Q24 GDP. US economic data showed that growth had slowed significantly and indicated that inflation had not subsided. The market is again concerned about economic expansion. Worried that the Fed will reduce interest rates only once this year. “WTI crude oil prices” rose 76 cents, while “European stock markets” closed negative.
The Dow Jones Industrial Average (DJIA) on April 25, 2024 closed at 38,085.80 points, down 375.12 points or -0.98%, but recovered from falling 500 points during trading hours. After reporting US economic data The latest shows that growth has slowed sharply and indicates that inflation has not subsided. This brings back concern about the expansion of the economy.
The S&P500 index closed at 5,048.42 points, down 23.21 points, -0.46%.
The Nasdaq index closed at 15,611.76 points, down 100.99 points, -0.64%.
The US Department of Commerce reported the first estimate of gross domestic product (GDP) for the first quarter of 2024 that it expanded at 1.6%, lower than the 2.4% that analysts expected.
This is a result of a slowdown in consumer spending.
In 2023, the U.S. economy expanded 2.2%, 2.1%, 4.9%, and 3.4% in Q1, 2, 3, and 4, respectively.
It also reported that the Personal Consumption Expenditures (PCE) Price Index for Q1 2024 increased 3.4% from 1.8% in the previous quarter. The Core PCE Index, which excludes food and energy categories, increased. 3.7% higher than 2.0% in Q4 2023
Both sets of data raise concerns that inflation remains high and that the Federal Reserve (Fed) may not cut interest rates as quickly as expected. Because when the two data are analyzed together It indicates a sluggish economic situation. due to slowing economic growth and rising inflation. That may be another obstacle for policy makers in implementing policies in the period ahead.
After the GDP data, traders lowered their expectations for further easing of monetary policy from the Fed, with CME Group’s FedWatch Tool indicating only one rate cut this year.
The 10-year Treasury yield rose to a 2024 high and moved near 4.7%.
At the same time, the market was also pressured by concerns about contraction in revenue growth from the technology sector. After a lackluster second-quarter 2024 sales forecast for Meta Platforms Inc., the parent company of Facebook and Instagram, the stock price fell 10.5%.
Meta’s earnings report raised concerns among investors ahead of other companies’ earnings releases. In the technology group, Microsoft, Alphabet, and Intel will report earnings after the market closes today.
IBM shares fell more than 9%, Caterpillar shares fell more than 7%. Both companies reported lower-than-expected quarterly results.
Other economic data reported yesterday included initial applications for unemployment benefits last week from the Labor Department falling 5,000 to 207,000, lower than the 214,000 that analysts had expected.
The National Association of Realtors (NAR) reported that the Pending Home Sales Index for March increased 3.4% month-on-month, higher than the 0.4% that analysts expected.
Investors are also keeping an eye on the PCE index release. March, which analysts expect will increase 0.3% month-on-month.
European stock markets closed lower on weak results from consumer giant Nestle and Dutch digital payments company Adyen, while sentiment took a hit. After reporting weak economic growth data from the United States, the world’s largest economy.
The STOXX 600 index fell as much as 1.3% during the day.
Industrial products fell 1.8%, leading other sectors to decline, with Adyen shares falling 18.4% after first-quarter sales fell short of expectations. and analysts’ concerns about fees being charged at record lows.
Nestle shares fell 2% after first-quarter sales fell short of estimates, sending the food and beverage group down 1.1%.
The technology sector fell 1%, following a similar drop in the U.S. after MetaPlatforms signaled that high-cost investments in AI could take years to break even.
Sentiment was further boosted by data showing that the US economy Growing at slowest rate in nearly two years As inflation accelerates This has led to increased speculation that the Federal Reserve will not cut interest rates before September.
Hermes shares fell 2.4% as investors took profits. While the company reported first-quarter sales up 17%, shares of LVMH and Richemont fell 2.8% and 1.2%, respectively, leading the luxury sector to decline 1.7%.
The STOXX 600 Index closed at 502.38 points, down 3.23 points, -0.64%.
The FTSE 100 London Stock Exchange Index closed at 8,078.86 points, up 38.48 points, +0.48%.
The French stock market CAC-40 index closed at 8,016.65 points, down 75.21 points, -0.93%,
The German stock market DAX index closed at 17,917.28 points, down 171.42 points, -0.95%.
WTI crude oil price for delivery in June. It rose 76 cents, or 0.92%, to close at $83.57 a barrel. And the price of North Sea Brent crude oil for June delivery increased 99 cents, or 1.12%, to close at 89.01 dollars per barrel.
Tags: Dow Jones closes points GDP expected high inflation worries Fed cutting interest rates year
-
