Wall Street down, despite the excellent news coming from the US job market (too positive?). The Dow Jones lost around 200 points (-0.54%), at around 34,409 points; the S&P 500 fell 0.60% to 4182 points, while the Nasdaq underperformed with a fall of 0.74% to 13,652 points.
From the US macroeconomic front, the May ADP report was released.
The data showed that the private sector created 978,000 new jobs in May, far more than the 680,000 growth expected by Dow Jones economists. Basically, American companies have hired nearly 1 million people, at the strongest pace since June 2020, when the US economy was emerging from the lockdowns of the first wave of the Covid-19 pandemic.
Good numbers also from the usual report of the initial applications for US unemployment benefits: in the week ending May 29, the number of American workers who applied for the first time to receive unemployment benefits was equal to 385,000 units. better than the 393,000 units expected by the Dow Jones consensus and above all less than 400,000 units, for the first time since the first days of the Covid-19 pandemic alarm, or since March 2020.
The positive news caused US Treasury yields to rise – however slightly -, with 10-year yields just above the 1.60% threshold.
Someone begins to say that tapering is already in place.
On the other hand, the Wall Street Journal reported the rumor that the Federal Reserve will soon begin to sell those corporate bonds and ETFs it amassed last year through the launch of a vehicle, dubbed the Secondary Market Corporate Credit Facility, or SMCCF. . Thanks to this instrument, in the belly of the Fed there are bonds issued by American companies of the caliber of Whirlpool, Wal-Mart and Visa (data as of April 30th), for a total value of $ 5.21 billion.
In addition, the Fed also swallowed corporate bond ETFs totaling $ 8.56 billion, such as the Vanguard Short-Term Corporate Bond ETF.
Today, the reasons that have supported the birth of these anti-Covid-19 bazookas, according to many economists, are gradually failing. And this is the result of the Fed’s Beige Book itself, released yesterday.
The report, which the Fed publishes eight times a year, highlighted that several US districts cited the positive effects of speeding up vaccinations on the economy: effects that unfolded thanks to the easing of previously imposed social distancing measures. , which had mainly quarantined the service sector.
The same districts also confirmed the presence of problems in supply chains, which in some cases prevented supply from promptly meeting demand.
Regarding the titles protagonists of the session, the scepter still belongs to meme stocks, after the buy boom that led Amc Entertainment to fly, in a single session, over + 100%.
However, the stock is turning around, after the jump of about 20% reported in the pre-market, falling back by more than 8%.
The decline follows the announcement by AMC, which announced a plan to proceed with a new offering of shares, up to 11.5 million class A common shares.
The company has announced that it intends to use the proceeds from the sale of shares “for corporate purposes in general,” which could include repaying existing debt and purchasing other assets.
“We believe recent volatility and our current market prices reflect market and trading dynamics unrelated to our underlying business, or macro and industry fundamentals. And we do not know how long these dynamics will continue ”, reads the statement that the number one group of cinemas in the world filed with the Sec.
Recent rampant buying from retail traders in the Reddit community has resulted in AMC flying nearly 140% this week. Prices have jumped 512% this quarter, up 2,850% since the start of 2021. The rally has pushed the market value above $ 31 billion.
GameStop lost about 4.6%, after the rally of more than + 13% on the eve; BlackBerry is still booming with an increase of over + 28%, after + 32% yesterday; Bed Bath & Beyond capitulated by more than 16%, after jumping 62% in yesterday’s session.
The General Motors stock is up by more than 2%, after the Detroit auto giant said it expects “significantly better” results for the first half of 2021 compared to previous guidance. Electric-car giant Tesla is doing less well, down 0.61%, after Chinese authorities said the group is recalling 734 Model 3 vehicles, produced in 2019 and delivered to China, for problems detected in the belts. safety and wheels.
In general, the attitude of attentive to the markets can also be explained by the wait for the US employment report that will be announced tomorrow and which, according to analysts, will highlight the creation of 671,000 new jobs in the May.