Wall Street Bullish as US Stocks Reach Record Highs: Nike Soars Amid Trade Tensions
Stocks in the United States ascend to uncharted peaks
In the straits of Wall Street, spirits are buoyant amidst a fluid trade landscape. Tech stocks and sportswear manufacturers are leading the charge.
Last Friday, US stocks closed on a high note following a tumultuous trading session. The Dow Jones Index ended 1% higher, hitting 43,819 points. The S&P 500 and the Nasdaq Composite each inched up by 0.5%, setting new record highs. Bulls and bears alike grappled with optimism towards the resolution of US trade disputes, only for President Trump to pull the rug out with the cancellation of talks with Canada.
However, the market soon regained its footing, with media reports suggesting that both the EU and USA are optimistic about reaching an agreement by the July 9 deadline. Furthermore, the USA and China have reportedly signed an agreement to restore trade peace, with ten more trade agreements purportedly in the pipeline[1]. This boost in investor confidence put a spring back in the market's step, while the ceasefire in the Israel-Iran war helped oil prices and the US consumer sentiment index inch up[1].
Economically, the US personal consumption expenditures price index remained steady at a 2.3% annual rate in May, although personal income unexpectedly took a dive from expectations[1]. The University of Michigan's consumer sentiment index also saw a slight uptick in its second June survey. All in all, these developments do little to challenge the recent speculation about US interest rate reductions, which have fueled the fervor on the US stock market and squeezed US bond yields[1].
At the bond market, yields rebounded slightly following the breakdown of US-Canada negotiations, inching up by 3 basis points to 4.28% within the 10-year range. The US dollar strengthened against its Canadian counterpart and other currencies, with the Euro trading at around 1.1710 dollars[1]. Oil prices edged higher due to the peace in the Israel-Iran conflict, while gold faced substantial pressure due to waning investor risk aversion[1].
From the Stock Market: Nike Tops the Charts
The market is abuzz about sportswear giant, Nike. While the company's latest quarterly results exceeded analyst estimates, they still fell short of last year's levels. In an attempt to counteract this decline, Nike aims to diminish its reliance on Chinese production sites and in turn lessen the impact of tariffs[1]. As a result, Nike's stock skyrocketed by over 15%[1].
In the shadow of Nike's success, Under Armour's stock rose by 2.3%, while Dick's Sporting Goods also benefited, with its stock jumping by 3.5%. On the flip side, MP Materials took a hit due to China's intention to export "controlled goods" to the US[1].
Concentrix's quarterly results fell flat, as did its outlook, causing the stock to tumble by 6.2%. Cormedix plummeted by 16.4% after a major share placement. MRC Global, however, improved by nearly 12%. Now, an industrial goods provider, intends to snatch energy supplier MRC Global for $1.5 billion, which sent Now's stock soaring by 4.3%.
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Source: ntv.de, ino/DJ [1] Bloomberg.com
The spirited environment on Wall Street continues, with the stock market still surging as US stocks reach record highs. Notably, Nike's success has contributed to this, as its stock soared over 15% amidst trade tensions and an aim to diminish reliance on Chinese production sites. Additionally, the employment policy of tech stocks and sportswear manufacturers appears to be a key factor in this surge, reflecting the fluid investment landscape. This rise in stock prices, in turn, indicates potential increases in both corporate profits and employee compensation, as stipulated in the employment policy, potentially steering the community policy towards economic growth. In the midst of these developments, various financial funds may be considering these "hot stocks" for investing purposes, given the strength of the stock-market.
