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The bull statue on Wall Street, New York (GETTY IMAGES NORTH AMERICA/SPENCER PLATT)
The New York Stock Exchange closed sharply higher on Friday on a technical rally after a nightmarish week as investors doubted the worst was over.
The Dow Jones gained 1.47%, the Nasdaq index gained 3.82% and the broader S&P 500 index rose 2.39%.
For Wells Fargo analysts, Wall Street offered “a break in the form of an increase”, after five consecutive negative sessions of the Dow Jones and a new drop in the Nasdaq. A technical bounce, according to them, having exceeded several technical thresholds to the downside.
“We needed it, but it may not be very significant yet,” said Gregori Volokhine, president of Meeschaert Financiel Services. “It would take several augmentation sessions to say that the worst is behind us and, frankly, I would be surprised.”
“It should also be noted that the rebound is not made in any news”, he pointed out, but “a bit in a vacuum”.
During the week, the Dow Jones continues to fall 2.13%, while the Nasdaq falls 2.79%.
The mood was upbeat on Friday as the VIX index, which measures market volatility, fell to its lowest level in a week.
With the sunbeam bathing Wall Street, the rating outcasts were partying, after days or weeks of serving as scapegoats in the market.
This is how Roblox (+15.36%), Rivian (+9.88%), Snap (+8.70%), Netflix (+7.65%) or AMD (+9.26%) were searched.
In this bargain-hunting climate, even the rating heavyweights jumped, first of all Apple (+3.19% to $147.11), which the day before had hit its lowest level in eight months.
Even GameStop (+9.85%), Peloton (+16.52%) or Shopify (+13.85%) benefited from the suction.
“Among the biggest actions, we find the + equal + actions (viral actions like GameStop) and the shoddy actions,” Gregori Volokhine noted. “It means there are quite a few +short+ covers and it’s still not enough to show signs of a real uptick.”
In addition to buying cheap, the session will thus have been fueled by the hedging operations of speculative operators, who after having bet in recent weeks on the fall on stocks or indices (or “short”), have picked up the bet.
“Tech” was also supported by some strong results, notably e-commerce credit payment specialist Affirm (+31.43% to $23.71), whose quarterly turnover turned out better than expected and loss less than expected.
As for office-sharing specialist WeWork (+20.07% to $6.76), it narrowed its loss in the first quarter and analysts at Piper Sandler estimated, in a note, that the group was nearing profitability.
Another takeoff, that of online brokerage platform Robinhood (+24.88% to $10.69), which benefited from the announcement of a 7.6% stake in blockchain entrepreneur Sam Bankman-Fried.
Friday also marked a new episode in the Twitter saga, the acquisition of which was “temporarily” suspended by Elon Musk. The businessman says that he wants to verify that false accounts represent less than 5% of the total, as the blue bird group affirms.
After sinking in pre-open electronic trading on Wall Street, shares rose a bit but still ended down 9.67% at $40.72, supported by a new tweet from Elon Musk: “still committed to this acquisition.
Twitter is now worth 25% less than the price offered by Musk, which indicates the doubts of many investors about the success of the operation.
Due to the effect of communicating vessels, the Tesla share, of which Elon Musk is at the head, offered a rise (+5.71% to $769.59). The stock had lost more than 23% from the previous six sessions.
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