USA: Large declines on Wall Street, debt yields are the highest in 16 years

Wednesday’s session on Wall Street ended with significant declines in the main indexes. Investors’ attention is focused on quarterly results of companies, as well as the increase in the yield of American bonds to the highest level in 16 years.

The Dow Jones Industrial dropped 0.98% at closing. and amounted to 33,665.08 points.

The S&P 500 fell 1.34% at the end of the day. and amounted to 4,324.60 points.

The Nasdaq Composite lost 1.62%. and closed the session at 13,314.30 points.

“The dominant force in the market remains inflation and its importance for central banks and how the resilience of the U.S. economy keeps the risk of a Fed response alive. The dollar is not rising rapidly and is relatively stable. Another issue is bond yields. In the face of geopolitical tensions, one would expect bond yields to fall as they are a safe haven, but in fact bond yields have risen,” said Samy Chaar, chief economist at Lombard Odier.

Philadelphia Federal Reserve President Patrick Harker said interest rates are at a level where further increases may not be necessary.

The number of new home building permits issued in the US in September (an indicator of future activity in this sector) was 1.473 million on an annualized basis (SAAR), compared to 1.541 million in the previous month. Analysts expected that the number of new building permits issued would be 1.453 million.

In the US, there was a decline in the MBA mortgage application index – the seasonally adjusted index fell by 6.9%. during the week ending October 6. Previously, the index increased by 6%.

Morgan Stanley’s Q3 earnings per share were $1.14. The market expected $1.10. Morgan Stanley’s net revenues were $13.30 billion vs. market consensus of $13.25 billion.

Core earnings per share for Procter & Gamble, the world’s largest consumer products company, were $1.83 in Q3 (FY2024). The market expected $1.72 per share.

Revenues amounted to USD 21.9 billion in the reporting period compared to the forecast USD 21.57 billion.

Israel’s bombardment of the Gaza Strip continues for a second week. The Palestinian authorities reported that more than 500 people were killed on the night from Tuesday to Wednesday when a rocket hit the Al Ahli Baptist hospital. In other hospitals, there is no fuel to power generators, and patients injured in shelling are transferred to other departments.

On the oil market, WTI futures for November are priced at USD 88.10 per barrel, up 1.66%, and December Brent futures are up 1.55%. up to USD 91.29/b.

US crude oil inventories last week fell 4.49 million barrels, or 1.06 percent, to 419.75 million barrels. Gasoline stocks fell by 2.37 million barrels, or 1.05 percent, to 223.3 million barrels during this time.

Reserves of distillate fuels, including heating oil, fell by 3.19 million barrels, or 0.4 percent, to 113.77 million barrels. (PAP)

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