Overview of the US stock market for the week

The major US stock indexes finished today's trading above zero

At the end of the trading week: the DOW -2.65%, S&P -2.26%, Nasdaq -1.17%

on Monday, the main US stock indices ended mixed amid concerns that the country is too early began to soften quarantine measures, which may happen a new outbreak COVID-19. Germany and South Korea reported an increase in new cases of coronavirus after the weakening of quarantine measures. This caused concern that the country can suspend the process to restart the economy. The prospect of worsening relations between the US and China also pressured the market. The US President, trump said Friday that he has not yet made a decision on a trade agreement with China, after just a few hours after a high-level trade representatives from both countries pledged «timely perform its obligations under the agreement», even though the coronavirus. In addition, on Monday, Beijing warned that it would take countermeasures in response to Washington's decision to tighten visa rules for Chinese journalists, and urged the U.S. government to immediately correct their mistakes. Market participants also continued to monitor the quarterly reports of US companies.

On Tuesday, major stock indexes in the U.S. dropped significantly, as investors weighed the potential consequences of premature lifting of quarantine amid reports that major economies that have weakened the restrictions, including Germany and China, have seen an increase in the number of cases COVID-19. Dr. Anthony Fauci, one of the most influential scientific advisers of the American President Donald trump and other officials in the healthcare sector have appeared before the U.S. Senate Committee on health, education, labor and pensions with the arguments over the resumption of business activity. Fauci said that in the United States is developed at least eight potential vaccines against coronavirus and expressed the hope that the results of clinical trials, good results will show several. But he warned that it will take some time before the vaccine becomes available for use. In turn, the world health organization (who) said on «potentially positive data» methods of treatment COVID-19. Press Secretary of the who, Margaret Harris stated that some treatment methods are likely to limit the severity or duration of respiratory illness COVID-19 and that the organization focuses on studying four or five most promising. Investors also studied a report from the labor Department, which showed that consumer prices in the U.S. fell in April in line with forecast. According to the report, the consumer price index in April fell by 0.8% after falling 0.4% in March.

In the environment major U.S. stock indexes fell heavily as market participants analyzed the recent statements of the Chairman of the Federal reserve system Jerome Powell. In his speech, the fed Chairman commented on the state of the US economy, which, according to him, is undergoing a «the unprecedented scale of the downturn». He also noted that the economic Outlook is highly uncertain and downside risks are significant, adding that may need additional policies to avoid long-term damage. Powell promised that the fed will continue to use policy tools «full», until the crisis passes and economic recovery will not begin in full swing. However, on the question of a possible reduction in interest rates to negative values, Powell said that the fed at negative interest rates has not changed. «We returned to this issue in October, and in a matter of minutes all the members said it is not an attractive policy tool», he said. The American President trump have recently called on the fed to use negative interest rates, wrote on Twitter: «While other countries benefit from negative interest rates, the US also needs to accept this «a gift». Large numbers!»

On Thursday, major US stock indexes rose moderately, helped by a rally in the financial sector, while the comments of the President of the United States trump reinforced concerns about Chinese-American trade relations and duration of the economic downturn. Trump said in an interview with Fox Business that he is very disappointed in China due to the fact that he could not restrain the new coronavirus, outbreak which marred his trade deal with Beijing. However, he said he was not going to re-discuss the trade deal with China but added that US ensure that Chinese companies that trade on American stock exchanges, complied with accounting rules, which operate on the territory of States. Investors also continued to receive evidence of the damage to the American economy COVID-19. A report from the labor Department showed that the number of initial claims for unemployment benefits in the United States amounted to 2.981 million in the week ended may 9, which was 195 000 less than the revised level of the previous week 3.176 million, but exceeded the estimate of economists, who had expected the number of applications for unemployment benefits fall to 2.5 million the Number of applications for unemployment benefits declined steadily since reaching record highs in 6.867 million at the end of March, but the number of new filings reached nearly 36.5 million after caused by a coronavirus economic downturn. Market participants also continued to monitor the quarterly reports of US companies.

On Friday, the major US stock indexes rose, but only slightly, as market participants tried to overcome depressing economic data and increased tension in relations between the US and China. The report of the Ministry of Commerce showed that retail sales fell 16.4% in the past month, and it was the biggest decline since the government began tracking the series in 1992. Data for March were revised to show that sales fell by 8.3% instead of falling by 8.7%, as previously reported. Economists predicted that sales will fall by 12.0%. In turn, the fed reported that industrial production in April declined by 11.2%, which was the largest decline over the 101-year history of the index. Economists had forecast that the index will show a decline of 11.5% after falling in March by 4.5%. At the same time, the report of the University of Michigan indicated an unexpected improvement in consumer sentiment in the U.S. in early may amid widespread payments to mitigate the impact of the pandemic and discounts on expensive products, while pessimism has increased regarding the long-term prospects for incomes and the economy. According to the report, the preliminary sentiment index increased by 1.9 points — eight-year low in April — to 73.7. Experts expect the decline to 68.0 points. Reuters reported that the administration of US President Donald trump's plans to cut Chinese Telecom giant Huawei Technologies from the world's chip suppliers. According to the Agency, the U.S. Department of Commerce announced that it is amending the export rule, «strategically aiming at the acquisition of Huawei semiconductor, which are the direct product of a certain software and technology». The Ministry also added that the «suppresses the efforts of Huawei to undermine U.S. export controls».

To industries almost all the sectors of the S&P for the period 11 to 15 may inclusive showed a drop. The largest decline was recorded by the real estate sector (-8,50%). The maximum increase has demonstrated the health sector (+0,47%).

With regard to the components of the DOW, last week's decline showed that 19 of the 30 stocks included in the index. The most negative result for the week was demonstrated by the shares of 3M Company (MMM, -6.69%). Leader shares were Cisco Systems, Inc. (CSCO, +5.99%).

Information-analytical Department TeleTrade

Source: teletrade.ru

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