New York stock markets closed lower on the return of the holiday, after the People’s Bank of China (PBoC) frustrated expectations of greater stimulus to the economy with a 10 basis point cut in interest rates. The jump by Tesla, Nvidia and PayPal amid the corporate news, mitigated the losses, but caution still prevailed.
In the late afternoon in New York, the Dow Jones index closed down 0.72%, at 34,053.87 points; the S&P 500 lost 0.47% to 4,388.71 points; and the Nasdaq retreated 0.16% to 13,667.29 points.
China’s 10 basis point cut in China’s benchmark lending rates (LPRs) sparked a cautious business picture that rippled through Wall Street. “This rate cut will not do much to boost the struggling economy, although it is clearly better than nothing,” ING said in a report.
Big banks saw considerable declines, with Goldman Sachs down 2.24%, Citigroup down 1.20%, and Morgan Stanley down 1.54%. Oil companies also fell, in the wake of the fall in the price of oil futures contracts. Chevron retreated 2.28% and ExxonMobil, 2.29%. The energy sector was the worst performer of the 11 in the S&P 500, falling 2.29%.
Boeing lost 3.46% in New York, as concerns about financial metrics overshadowed announcements of aircraft orders in Asia.
On the other hand, Tesla (+5.34%) and Rivian Automotive (+5.51%) stood out in the trading session, accumulating the highest increases in the Nasdaq index, after the announcement of a partnership in the supply of electric batteries.
PayPal gained 3.70% after closing a deal with investment firm KKR and raising its share buyback forecast for 2025 to $5 billion.
Another highlight was the semiconductor company Nvidia, which rose 2.61%, in a movement contrary to that of other chip makers. Qualcomm, Micron and Texas Instruments fell 2.33%, 1.12% and 1.36% respectively.
Capital Economics partially attributed to artificial intelligence its revised upward projection of S&P 500 earnings over the next two years, predicting the index to reach 6,500 points by the end of 2025, from around 4,300 currently.
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