The prospect of a continuation of the zero interest rate policy in the US through 2023 only briefly pleased investors on Wall Street on Wednesday. After the US leading index Dow …
NEW YORK (dpa-AFX) – The prospect of a continuation of the zero interest rate policy in the US until 2023 only briefly pleased investors on Wall Street on Wednesday. After the US leading index Dow Jones Industrial (Dow Jones 30 Industrial) initially climbed by more than 1 percent, profits melted almost completely by the end of trading. Investors had already expected that the US Federal Reserve would apparently leave its key rate at the zero line for years in view of the Corona crisis. In addition, Federal Reserve Chairman Jerome Powell did not deliver any positive surprises following the announcement of the latest monetary policy decisions and thus caused disappointment, said Edward Moya, a market analyst at trading house Oanda.
The Dow closed just 0.13 percent higher at 28,032.38 points. The market-wide S&P 500 slipped into the red and lost 0.46 percent to 3385.49 points. The technology-heavy NASDAQ 100, which recently did quite well again, fell by 1.67 percent to 11,247.60 points.
The zero interest rate policy is to be continued until full employment is achieved on the labor market. Powell also reiterated his view that the state must increase its financial support during the crisis. The Republicans and Democrats are currently arguing in the US Congress over the modalities of a further aid package. It’s all about the volume of the package. The Democrats want to provide additional funding in the trillions, the Republicans want to put together a much smaller package.
“If the political blockade continues foreseeably after the presidential election, the pressure on the central bank would increase again to further open the money locks,” said Uwe Burkert, chief economist at Landesbank LBBW. “One possible means for this could be an increase in bond purchases and steps that actually raise the barriers to a future interest rate hike even higher.”
On the corporate side, thanks to strong quarterly figures, FedEx shareholders enjoyed a price jump of almost six percent. The shares were thus among the best values in the S&P 500. Several analysts saw the results above expectations and raised their price targets for the stocks of the logistics group.
The software company Adobe had also surprised positively and achieved a record quarterly revenue during the Corona crisis. However, the stocks quickly lost initial gains and ended up falling more than four percent after investors cashed in on the good news.
The software specialist Snowflake meanwhile made a brilliant debut on the New York Stock Exchange. Investors had torn the papers of the company from San Mateo, California, which wants to heat the market leaders Amazon and Microsoft in the booming cloud business with IT services and storage space on the Internet. At $ 245, the initial price was more than double the issue price of $ 120. The papers closed at just under $ 254.
The company had raised $ 3.36 billion when it went public and was valued at more than $ 30 billion. Snowflake thus achieved the biggest premiere of the year on the US stock market to date. The expectations of the company are high; for once, even star investor Warren Buffett took part on a large scale with his investment company Berkshire Hathaway.
The euro came under further pressure after the monetary policy decisions of the Fed and was most recently quoted at 1.1814 US dollars. The European Central Bank (ECB) had previously set the reference rate at 1.1869 (Tuesday: 1.1892) dollars. The dollar cost 0.8425 (0.8409) euros. Trendy 10-year US Treasuries fell 5/32 points to 99 10/32 points. They yielded 0.697 percent./la/fba
— By Lutz Alexander, dpa-AFX —