Reassured by employment, Wall Street will try to keep his confidence – Boursorama

Tourists are photographed Oct. 17, 2014 in front of the sculpture known bronze as the” Bull Wall Street “, near the New York Stock Exchange (AFP / File / JEWEL SAMAD)

After a weekend lit by encouraging figures on US employment, Wall Street, shed on track, will look for elements likely to confirm this renewed confidence.

In the last five sessions, the index Featured Dow Jones Industrial Average gained 0.93% to 18,191.11 points.

The Nasdaq, dominated by technology, has barely budged, losing 0.04% to 5,003.54 points and the broader index Standard and Poor’s 500, closely watched by investors, took 0.37% to 2116.10 points.

The indices zigzagged for much of the week, for want of elements to digest but frankly have revived Friday after the release by the Government US figures on employment in April in the United States.

“This is a week that began under the sign of the confusion and ends in a surprisingly positive,” summed Gregori Volokhine of Meeschaert Financial Services. “The confusion was sown by something that was not expected at all, that is to say, Janet Yellen’s comments on the markets.”

The president of the central bank US (Fed) said Wednesday that the valuation of the stock markets was “quite high” and that it had “potential dangers”.

However, investors quickly forgot these statements and “fell back on their feet Friday with the employment figures, “ruled Mr Volokhine.

223,000 hires in April, a clear rebound after a march frankly mediocre, and a slight decrease in the rate of unemployment, these figures do not surprise the markets but have reassured them, although wages have recorded only a very small increase.

“Investors see that the job market things are going in the right direction after a difficult first quarter, “with almost no growth, explained Volokhine. “But they also see that wages increase little, which does not give ammunition to the Fed to be aggressive, whether in June, September or December. This is an ideal situation for an investor.”

– “Thinking in reverse” –

The markets are wondering when the Fed, which attaches particular importance in wages, will raise interest rates, currently almost zero, and thus remove valuable support to the economy.

“But the Fed does not care whether the employment figures are better or worse than Wall Street expected!” tempered Chris Low of FTN Financial. “What she is going to see is the rebound in hiring, falling unemployment (…) and I think she will say that a rate hike is still conceivable in June,” date of its next monetary policy decision.

The president of the Federal Reserve Janet Yellen (g) and IMF Managing Director Christine Lagarde, during a conference on “Finance and Society”, May 6, 2015 in Washington (AFP / MANDEL NGAN)

“That said, if they want to take this path, they will need more growth, and this plan the next test, it will be the number on retail sales in April, “Wednesday, he ruled. “While the first quarter was disappointing is primarily because people spent less than expected for retail items.”

Among other notable indicators, figures on industrial production will be announced Friday, also for April.

“Seen as the fear of a rise in interest rates causes people to think backwards, I think the market would react well to a small decline,” he warned Mr Low.

In terms of businesses, the stock market should however face a smaller current, when the results of the first quarter business is complete, even if the market continues to be driven by a series of acquisitions rumors, often denied, such as the Salesforce software company by the Microsoft IT group

“Within the S & amp;. P 500, 65% of groups announced better than expected, which is rather positive, “ruled Tom Cahill, Ventura Capital Management. “On Wall Street, the recent volatility was largely due to the perspective of results, so I think things will calm down.”

“What worries me the most is Greece which must repay € 750 million to the International Monetary Fund (IMF) 12, “he concluded. “We come to the thorniest issue in the negotiations, and it could really fill the market.”

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