USA: Wall Street has solid gains. Investors are counting on an agreement on the debt ceiling

Friday’s quotations on Wall Street ended with significant increases in the main indices. Investors are hoping for an agreement on the debt ceiling, which would avoid a possible US default.

Dow Jones Industrial closed up 1.0 percent. and amounted to 33,093.34 points.

The S&P 500 ended the day up 1.3%. and amounted to 4,205.45 points.

The Nasdaq Composite gained 2.19 percent. and closed the session at 12,975.69 points.

Investors are more optimistic about the situation in the US after Bloomberg reported, citing anonymous sources, that Republican and White House negotiators are closer to reaching an agreement on increasing the debt ceiling and reducing federal spending for two years.

Concerns over whether the two sides will be able to reach an agreement and avoid insolvency have weighed heavily on the markets in recent weeks.

“This is a key point of concern as it is important to the growth dynamics in the US,” said Peter Garnry, head of equity strategy at Saxo Bank.

“We expect both parties to reach a debt settlement that will have a significant impact on economic growth. If they act too aggressively toward deficit reduction in the future, then of course that will create some obstacles for the US economy.”

A U.S. bankruptcy by failing to raise the debt limit would be self-inflicted and would shake the foundations of the global economy, International Monetary Fund chief Kristalina Georgieva said on Friday, urging the U.S. to find a deal quickly.

“We consider the US bond market as an anchor for the global financial system and that anchor has to hold on to something. At this time of significant uncertainty, we don’t need to add self-injury to what the global economy is already facing,” Georgieva said at a press conference following meetings with Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell.

The IMF also predicts that the fight against inflation in the US will take longer than expected and will require keeping interest rates high for longer.

The Personal Consumption Price Index, one of the Fed’s preferred indicators of inflation, rose faster than expected by 0.4 percent in April. according to data from the Commerce Department published on Friday.

Markets value 58 percent. chances of a rate hike by the Fed in June.

Marvell Technology Inc share price increased by 32.4 percent. after the chip maker posted better-than-expected results and said it expected significant revenue growth from artificial intelligence technology.

Ulta Beauty Inc shares fell more than 13 percent. after the company posted mixed first-quarter results.

The share price of the retailer GAP increased strongly, over 12 percent, despite the company recording a loss and a decrease in sales. Investors liked the improvement in margins resulting from reduced promotions and lower freight costs.

U.S. Commerce Secretary Gina Raimondo discussed concerns about recent action against U.S. companies operating in China during a meeting with her Chinese counterpart Wang Wentao, the Commerce Department said in a statement.

“Secretary Raimondo also expressed concerns about the recent wave of actions by the PRC (People’s Republic of China) against US companies operating in the PRC,” the statement said.

“The two had a frank and substantive discussion on issues related to the US-China trade relationship, including the two countries’ general trade and investment environment and areas for potential cooperation,” it added.

In oil, July WTI futures are trading at $72.8 a barrel, up 1.4%, while July Brent futures are up 1%. to approx. USD 77/b. (PAP)

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