Dow bounces with an eye on debt ceiling talks

Dow jumps with one look at Biden's debt ceiling talks

The Dow Jones added 0.41% to 33,146, while the S&P 500 also gained 0.41% to 4,126. The NASDAQ 100 added 0.39% to mark 12,390 points.

In the regular session on Tuesday, concerns about the possibility of default dominated the investors. The Dow led the major indices down 1%. It has barely closed an uptrend in the last seven days, Meanwhile, the S&P 500 and Nasdaq Composite fell 0.6% and 0.2%, respectively.

Although today some optimism seems to be returning. The White House said on Tuesday that President Joe Biden has directed staff to meet daily to discuss unfinished business in debt ceiling talks, The President has also canceled the second leg of an upcoming international trip to Asia to focus on negotiations.

House Speaker Kevin McCarthy believes there is now a “better process” for further negotiations, to the extent that he thinks “a deal is possible by the end of the week.”

“People are going to try to predict what the next headline is going to be,” says Sam Stovall, chief investment strategist at CFRA Research. “The stakes are high, and unfortunately there’s not much we can do to predict what’s going to happen.”

“The most likely scenario is a short-term increase or suspension of the debt ceiling to allow the parties, the Biden administration and Congress, more time to reach a more definitive cut agreement,” he explains. Juan J. Fernandez-Figueres, Link to Gasteone, Furthermore, “although there has not yet been a definite progress in the talks, Talk grows about the possibility of a bipartisan deal ending the impasse and avoid a US default, the latter scenario, as we’ve pointed out earlier, would be dramatic for the country’s economy and the global economy.

In addition to an update on debt ceiling negotiations, investors learned in the macroeconomic section today Data on Housing Starts and Building PermitsWhich shows an increase of 2.2% and a decline of 1.5% respectively in April as compared to March.

On the business front, the quarterly results season is entering its final leg. Of the 500 components of the S&P 500, 460 companies have already published their results and the average decline in earnings per share is -3.6%, compared to -8.2% expected (before the first company’s publication). , The qualitative balance is as follows: 77.8% exceed expectations, 18.7% disappoint and the remaining 3.5% are in line. In the previous quarter, EPS declined by -2.4% compared to -3.3%, according to data compiled by Bankinter’s analysis team.

All eyes are directed towards the retail sector above all. If yesterday Home Depot disappointed with its report, also offering the market a pessimistic outlook on business growth this year, today it’s Target’s turn, while tomorrow Walmart will present its accounts.

Fernández-Figares cautioned, “The progress of this sector and the business expectations that companies are shifting are very relevant because they are a great indicator of how private consumption in the US could develop, a variable that has so far been greatly underestimated.” has been resistant.” ,

For now, target is up 0.7% after Wall Street beat expectations, the discount chain’s sales are barely growing year-over-year and customers are buying more staples. Earnings per share came in at $2.05, versus the $1.76 expectedWhile revenue climbed to $25,320 million, versus expectations of $25,290.

The retailer maintained its outlook for the fiscal year. It expects comparable sales to be in the low-single-digit range and up in the low-single-digit range, while its full-year adjusted earnings per share will range from $7.75 to $8.75.

outside the earning season, Western Alliance shares surged nearly 12% after the bank announced deposit hike The current quarter has exceeded $2 billion since May 12. Shares of Western Alliance have experienced a rally recently, up 17% in the past week, and have gained 15% since the start of the week. However, they continue to lose about 47% on the year.

Market hero also Tesla. The company held its annual shareholders meeting on Tuesday, during which its CEO Elon Musk announced that it will deliver its first Cybertruck by the end of this year and begin advertising it.

In reference to analyst recommendations, shares of Wynn Resorts are up more than 2.5% Barclays experts advise ‘overweight’ casino operator, above ‘at par with the market’. The broker attributes the improvement to the continued recovery of Wynn’s properties in Macau and raised its price target to $135 from $120, which translates to Upside probability of 31% Since closing on Tuesday.

In the commodity markets, US West Texas crude was up by 0.32% at $71.06. Benchmark Brent crude in Europe rose 0.37% to $75.16.

In fixed income, bond yields have been mixed pending talks on debt ceiling. In the case of the ten-year bond, the yield drops to 3.522%, while it remains stable at 4.082% for the two-year bond.

The euro fell 0.30% against the dollar to set an exchange rate of $1.0831 for each community currency.