Wall Street offered us a scenario never seen before this year: a sudden trend reversal after 3 hours of trading and the setting of a new flurry of absolute records, shortly after a very promising opening, in the wake of the Nvidia rocket.

Nvidia ended up alone in the world, at the zenith of the stock market firmament, while the rest of the stock market came back down to earth, in the wake of sharply deteriorating bond markets.

The S&P500 rose to 5,342, the Nasdaq Comp. to 17,000 (16,996 to be precise), and the Nasdaq-100 peaked at 18,807.

The Dow Jones opened stable, then lost -0.5% after 1/4 hour, weighed down by Boeing's initial -2% fall (which would later worsen sharply).
The Dow closed down -1.5% (at 39,065): its worst session since mid-March 2023 (30 out of 30 stocks in the red at the close) in the wake of Boeing -7.6%, Intel -4.3%, McDonald's -3%, Johnson & Johnson -2.5%.

All in all, the S&P500 dropped -0.75%, with 80% of components down, weighed down by cruise lines, airlines and pharmaceuticals. The Nasdaq fell -0.4% after posting a +1% gain at the opening, in the wake of Nvidia, which gained as much as +12% at $1.063, i.e. +$250 billion in additional capitalization (to $2,600 billion, i.e. 25 times its sales)

The Nasdaq ended in the red, despite Nvidia's +9.3% and +$230 billion in 'capi': this was offset by the fall of On Semiconductors -6.1%, Intel -4.3%, Tesla -3.5%, AMD -3.1%, Sirius -2.5%, Apple -2.1%, Alphabet -1.6%.

The American giant Nvidia, which has consolidated its status as the world's third-largest capitalization behind Microsoft, is now hot on the heels of Apple ($2,928 bn in market capitalization): the stock is set to rise by 110% in 2024, and its market capitalization of $2,595 bn exceeds that of all the industrial and service giants that make up the DAX40 index (the German economy has a GDP of 4.008Bn of GDP), or as much as Amazon + Tesla (which respectively achieve significantly higher sales).

Christopher Dembik, Investment Strategy Consultant at Pictet Asset Management, is astonished: "It's been a long time since the global economy has been so dependent on a single company", which accounts for 90% of the S&P500's performance in 2024.

"For the stock markets, Nvidia should continue to be a must-have this year, and probably in the years to come", he adds.

Nvidia's performance has overshadowed the concerns raised by the minutes of the Federal Reserve's latest meeting, which contained a number of unpleasant surprises: dissension over strategy, and the feeling that the inflation problem is far from resolved.

According to the CME Group's FedWatch barometer, the probability of a rate hike in September is now estimated at less than 50%, compared with 51.6% yesterday.
On the bond front, given the strength of some of the figures published on Thursday, the yield on 10-year Treasuries was up +5pts at 4.485%, its worst level of the week, while the 2-year was up +6pts at 4.938% (5% is getting closer: all we need to do tomorrow is duplicate today's counter-performance).

As for US figures, growth in the US private sector accelerated sharply in May, according to S&P Global's composite PMI, which came in at a 25-month high of 54.4 in flash estimates, compared with 51.3 in final figures for the previous month.

S&P Global points out that the "services" sector was the driving force behind this increase, posting its strongest output growth for a year, while the manufacturing sector also showed more vigorous growth.
On the downside, new home sales in the USA fell by 4.7% in April (down 7.7% on an annualized basis), according to statistics published by the Commerce Department on Thursday.
These came to 634.000 last month on a seasonally-adjusted annualized basis, compared with a revised 665,000 in March.
The median price of a new home reached $433,500 in April, compared with $439,500 the previous month, and the average was $505,700, down from $527,400 in March.
Lastly, the Labor Department announced a drop of -8,000 (to 215,000) in new US jobless claims.
The four-week moving average - more representative of the underlying trend - came in at 219,750, an anecdotal increase of 1,750 on the previous week.

The number of people receiving regular benefits rose by 8,000 to 1,794,000 in the week to April 29, the most recent period available for this statistic.

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