Last week, the last trading day ended with a good growth for US stock indices. However, positive Friday failed to “pull out” the extremely bad week. The statistics and the resumption of trade disputes between the States and China caused such a negative dynamics.
The U.S. Department of Commerce has released national retail sales statistics in April. It became known that compared with March, the indicator had fallen by 16.4%. This is an absolute record of the decline rate in history of tracking the indicator (28 years!). This is caused by the pandemic and the associated general isolation. The reality has turned out to be much worse than the most pessimistic forecasts analysts assumed that the reduction would not exceed 12%.
Moreover, the investors were not pleased by the released report of the US Federal Reserve on the industrial production in the United States in April. It became known that over the month the figure had fallen by 11.2%. And this is one more anti-record by the US economy, since such a rate of decline has not been observed even more than a century-old history of its calculations.
It is not at all surprising that over a week, Dow Jones has fallen by 2.7%, S&P 500 – by 2.3%, and Nasdaq – by 1.2%.
But the Consumer Confidence Index has risen from 71.8(in April) to 73.9 points. A message from the US Department of Commerce has had a negative pressure on the national stock market. Officials announced that Trump’s administration had decided to block the supply of semiconductors for the Chinese high-tech giant Huawei. Market participants closely monitor the knowledge-intensive sector, since it largely determines the behavior of the entire market.
If we talk about semiconductors, then we should remember about the company Applied Materials, whose capitalization has dropped by 4.4%. The company has shown an increase in both net profit and revenue in the second fiscal quarter. But since the numbers did not meet the market expectations, stock quotes began to peak down.
Here’s how the most significant US indices closed Friday:
- Dow Jones Industrial Average index has grown 0.25% and closed the day at 23685.42 points;
- Standard & Poor’s 500 has added 0.39%, closing at 2863.7 points;
- Nasdaq Composite has increased 0.79%, finishing the day at a value of 9014.56 points.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group