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Fear of rising inflation gives Wall Street no respite, which extends falls

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New falls in Wall street after registering your most bearish week since February. The US indices fell between 1% (Dow Jones) and 2.4% (Nasdaq) during the last five sessions, although they managed to recover on Thursday and Friday from the significant losses they accumulated in the first part of the week.

Investors continue to mull over the historical upturn in inflation registered in April in the US, although strong hands consider that any correction that occurs in the market is a opportunity to buy at more attractive levels.

"Bullard and other Fed advisers insisted that the rise in inflation is temporary, but seems too rally for the market to trust, no matter how much they insist that this is so ", they affirm from Bankinter.

"For this reason", these analysts add, "the stock market correction was marked from Monday to Wednesday and, as prices became more attractive and the American macro came out weak, Thursday and Friday they rebounded with some joy. Now, the worse the American macro is, the almost better for the bagsBecause that will cool the expectation that the Fed will have to change its plans and, for example, slow down the pace of bond purchases. Bad is good".

In his opinion, "what we have seen so far is not a change in market direction, but some bags that are standing near their new highs due to natural causes; and that when inflation is too high they have taken a special fear of the Fed, as is logical. "

For Bankinter, "the key to the vault now is how the American inflation turns out until July / August. But not inflation in isolation, but in combination especially with employment. Because if it improves very quickly (in April it did not, but disappointed) then the Fed could be in a hurry and be forced to change its strategy. "

In this scenario, most important data for investors in the next sessions will be the minutes of the last Federal Reserve meeting (Wednesday), which might give some additional clues to your outlook on inflation.

On Thursday, the weekly unemployment claims and the Philadelphia Fed manufacturing index, while the PMI indicators of economic activity in the Eurozone and the United States (preliminaries for the month of May) will be known on Friday. This Monday, New York Empire State Manufacturing Index it is down in May to 24.3 from 26.3, although the market expected a larger drop to 23.9.

All this occurs in a country that seems to have more and more controlled the Covid-19 pandemic. In fact, this Monday the president of the United States, Joe Biden, has notified that by For the first time since the pandemic began, all 50 states have seen their cases reduced.

At the corporate level, the divorce of Bill Gates and Melinda Gates continues to flow rivers of ink. This Monday all the media published that Gates left Microsoft after being investigated for having a relationship with an employee.

In addition, the operator AT&T It has been agreed spin off and merge its WarnerMedia media division with Discovery to compete with Netflix in the audiovisual streaming market. Discovery has posted strong gains, over 8%.

In other markets, the Petroleum West texas rises 0.1% to $ 65.45, while the euro it appreciates 0.02% and changes to $ 1.2143. In addition, the profitability of the 10-year American bond relaxes to 1.62% and the ounce of gold up 0.8% to $ 1,853. Finally, the bitcoin falls 1% to $ 45,050, following last week's sharp correction and new negative comments from Elon musk.

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