FRANKFURT/NEW YORK, Dec 20 (Reuters) – After Japan’s surprise interest rate policy tightening, U.S. stock markets closed with little change. The Dow Jones.DJI standard values index closed Tuesday up 0.3% at 32,849 points. The tech-heavy Nasdaq.IXIC was flat at 10,547. The broad S&P 500.SPX gained 0.1% to 3821 points.
Japanese monetary authorities surprisingly paved the way for a steeper rise in long-term government bond interest rates. At the same time, however, they announced that they would significantly increase bond purchases. Stockbrokers interpreted the move as an indication that ultra-loose monetary policy tightening may also be pending in Japan. “Rising interest rates is something they’ve never done before. So it looks like the world is on the same page and doing a coordinated rate hike to fight inflation,” said Kim Forrest, chief investor at US wealth manager Bokeh.
BONDS AND DOLLARS UNDER PRESSURE
The adjustment pushed the YenJPY= to a four-month high against the dollar. Conversely, the dollar fell 4.4% to 131 yen. The dollar=USD index fell 0.6% to 103.96 points. At the same time, US government bonds again left deposits. Ten-year US10YT=RR bonds returned 3.692% vs. 3.583% the previous day.
TESLA FIRES AFTER DOWNGRADE
In terms of individual stocks, downgrades from at least three analyst firms sent Tesla TSLA.O shares tumbling. Shares of the US electronics maker fell more than eight percent. Experts justified their assessment on weaker demand and the distraction of Tesla boss Elon Musk after he bought the short message service Twitter.
The mother of the “Cheerios”, General MillsGIS.N, also came under pressure and lost 4.6%. The maker of breakfast cereals and ready-to-eat pizzas had warned of rising raw material costs in its annual forecast. Gilead SciencesGILD.O was also among the losers, down 1.9%. Investors were disappointed by the results of the drug company’s study of a cancer treatment. In contrast, shares of aircraft manufacturer BoeingBA.N gained 1.4%. Congress had previously backed suspending a deadline on new safety standards for Boeing’s two best-selling jets.
US Treasuries
| T-bonds | Price Update | absolutely change | Performance Update | Return the day before |
| 10 years |
103.5625 | -0.9219 | 3,692 | 3,583 |
| 30 years |
104.5313 | -2.3125 | 3,747 | 3,623 |
Statistics for Nyse and Nasdaq
| nyse | Nasdaq | |
| Number of shares traded in millions | 934 | 4,564 |
| Number of shares with price gains | 2.218 | 2,380 |
| Number of shares with price losses | 1,987 | 2,220 |
| Number of unchanged values | 266 | 463 |
The US Dow Jones index closes in positive territory
Source: Reuters
Photo symbol: Image by Tumisu on Pixabay
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