Wall Street opens sharply lower after inflation

The New York Stock Exchange opened sharply lower on Thursday after the release of US inflation numbers for May, which were unchanged for May.

Prices rise to high levels

In the first exchanges of the last session of the half, which turns out to be one of the worst for the New York market since 1970, the Dow Jones index lost 1.07%. The Nasdaq was down 1.09% and the S&P 500 was down 0.99%. The quarter turns out to be one of the worst first halves of the year for the New York market since 1970. Wall Street ended without direction on Wednesday amid fears of further downside. The Dow Jones index increased by 0.27% and reached 31029.31 points. With a strong technological color, the Nasdaq lost 0.03% to 11,177.89, and the S&P 500 lost 0.07% to 3,818.83. “Can’t wait for this first semester to be over, worst since 1970summarized Briefing.com’s Patrick O’Hare. “Unfortunately, his last day begins on a low note in line with the first half of the year“, he added. Investors responded to lower inflation and consumption figures.

In the United States, price inflation remained high in May at 6.3% year-on-year, and household spending slowed, according to the PCE index, one of the main indicators of the economy. Inflation promoted by the US Central Bank (Fed). Inflation rose 0.6% for the month, up from +0.2% in April, the Commerce Department said, slightly below analysts’ expectations for +0.7%. On the positive side, however, core inflation, excluding food and energy prices, eased to 4.7% over the year from 4.9% in April. In another indicator that signals consumer anxiety about rising prices, household spending rose just 0.2%, down from 0.6% in April. However, in real terms, taking into account inflation, consumption, which is the engine of the American economy, decreased by 0.4% in May, which is a bad forecast for the growth of the 2nd quarter, Capital Economics analysts emphasized. Purchases of goods, particularly cars, have noticeably stopped. Overall, this sustained inflation raises fears that the Fed will tighten the monetary screw too tightly and push the US economy into recession.

The yield on 10-year Treasuries fell nearly 3%, reflecting the buying in these safe havens. All S&P sectors broke away from very defensive utilities (+0.31%). Non-core spending, the sector that has fallen the most since the start of the year as consumers brace for rising prices, lost almost 2.50%, followed by banks (-2.35%), information and communication technology (-2.12%) ). Drugstore chain Walgreens was under pressure (-4.33%) despite better-than-expected quarterly results, however, showing a drop in sales. Luxury furniture store chain RH fell almost 12% after it warned that its results would be affected by the economic environment.which is getting worse“. It dragged online furniture retailer Wayfair (-8.35%) while most retailers also slipped, from Walmart (-1.05%) to Target (-3.11%). Loss of risk appetite weighed on Bitcoin, which was well below the $20,000 mark at $18,878. The virtual currency was also hit by the stock market authority SEC’s listing of a bitcoin index fund by asset manager Grayscale.