After a hesitant start, Wall Street is increasingly moving towards recovery on Friday. The Nasdaq tech exchange, in particular, is getting a lot of tailwind after having crashed hard the day before.
Techbeurs Nasdaq advances 2.1% around 7.30 pm (Dutch time). The broad S&P 500 gains 0.8%. The Dow Jones index gains 0.5%.
The AEX closed 0.4% lower at 635.75 points after climbing to 646 points earlier in the day. The Midkap wins 1.4%, supported by the strong enthusiasm at ABN Amro.
“It’s all about inflation, especially the next US interest rate decision by potentially another 75 basis points,” said JPMorgan strategist Vincent Juvyns. “There are so many risks in the market, a disappointing inflation rate, gas crisis and an ongoing war can quickly increase the risks.”
The effective interest payment for the 10-year US Treasury bond falls 4 basis points to 3.262%. Its German counterpart, the bund is up fractionally at 1.699%. Dutch government debt of that duration is higher at 2.078% interest.
“That interest rates are finally going up after a period of absurdly low levels, often negative, is normal and actually a blessing. It does mean that there is no room for fantasy investments,” said ING’s market strategist Simon Wiersma. Valuations of all asset classes are under pressure, bond prices, which move in the opposite direction to the development of interest rates, but also equities. “That this is happening is not surprising in itself, but the pace has surprised almost everyone,” said Wiersma.
“With the countless risks that exist, the war, inflation, the gas price and the setbacks, investors want to tighten their trading book as much as possible after the expiration this afternoon without having much risk left over the weekend,” said Van Holst. “Everything is on edge, investors don’t want to take any risk over the weekend.”
“Air France KLM shares have lost 20% this week, investors think that some recovery is possible,” says trader Daam-Martijn van Holst of ABN Amro / Oddo about the individual shares. The mood on the stock market is subdued, investors are buying again towards the weekend, after the dramatic Thursday.
Tech Investment Fund prosus closes 3.4% higher, Just Eat is at the top of the AEX and gains 7.1%. Adyen follows with a gain of 4%. Universal Music Group halved its stake in Chinese Tencent and gains 2.5%. Also ING reports, the most traded stock at 1.1% price gain.
shell is down 5.2% in the basement in response to oil prices plummeting. The oil and gas group is also struggling with a workers strike at Prelude, the largest LNG platform in Australia.
In the Midcap, ABN Amro shoots up 5.5% after a big price jump earlier in the afternoon after the news that the French bank BNP Paribas would be interested in the Dutch bank.
Air France KLM 1.1% upwards. Investment bank Oddo issued a price target increase to €1.45, implying a 16% increase. At the same time, the threat of strike action among Air France pilots is coming through, and the increase in short positions by Jane Street and Millennium Capital in the stock.
Sector partner Qatar Airlines saw net profit in the financial year rise to 5.6 billion Qatari riyals, converted €1.5 billion. Never before in its 25-year history has the airline company’s profits been so high.