Shopping on Wall Street This Monday, led by the Nasdaq and technology stocks, after Friday's losses and after ending a mixed weekin which, precisely, the Nasdaq and the S&P 500 led the sales amid the market's rotation from technology to other sectors. In this session, investors remain very attentive to the US political situation before the Joe Biden withdraws from the presidential race. «Although my intention has been to seek re-election, I believe that The best thing for my party and for the country is that I retire. and focus solely on fulfilling my duties as president for the remainder of my term,» the current US president wrote in a letter published on social media to announce his resignation. Image shown by Biden in the first electoral debate Biden's decision to step aside and have another candidate represent the party in the November elections sparked doubts about his health and, from that moment on, there were constant calls from within the Democratic ranks. Faced with the loss of support and strong pressure, Biden decided this weekend to step aside and show their support for Vice President Kamala Harris as a Democratic candidate. «My first decision as a party candidate in 2020 was to choose Kamala Harris as my vice president. And it has been the best decision I have ever made. Today I want to offer my full support and endorsement to Kamala to be our party's candidate this year.. Democrats, it is time to unite and defeat Trump. Let's do it,» the US president called. For Ipek Ozkardeskaya, senior analyst at Swissquote Bank, «although Biden's departure reshuffled the cards for the November elections, did not materially change the expected outcome… yet. We don't know if Harris will be able to secure her party's nomination and gain enough momentum in the polls to beat Trump. Early data shows Harris is the favorite to become the new Democratic nominee, but Donald Trump is still expected to win the November presidential election«. It should be noted that Harris's campaign (the renamed Biden one) has raised almost $50 million in less than a day after this announcement. However, Biden's resignation has changed the outlook for the stock markets, and analysts BNY Mellon says markets are timidly unwinding part of last week's 'Trump trade'in relation to a trend that benefits companies best positioned for a second term of the Republican leader, for which higher tariffs with the rest of the world, lower taxes and deregulation are expected. Rabobank also expects the Trump Trade to «unravel, at least partially»so now the markets will give greater probability to a Democratic victory, and within the party it seems that all hopes are placed on Harris. The firm's analysts believe that the current vice president «is in the first position to become the party's official presidential candidate, although it cannot yet be ruled out that she will be challenged for the post.»
THE PCE IS KEY FOR THE FED
The week will also be marked by the publication of several macro references that will be closely followed by investors, above all, the PCE consumption deflator (Friday)key to determining the direction of the monetary policy of the Federal Reserve (Fed) and reinforce expectations of a first rate cut in September. The agenda also includes the Manufacturing and services PMI of the month of July (Wednesday), as well as the Second quarter GDPwhich is expected to rise to 2% from 1.4% previously, and the weekly unemployment data (Thursday). «Better growth combined with softer inflation would be the best possible outcome for the Fed«as it would mean that the central bank is getting closer to reducing inflation without sending the US economy into a recession. This should have a positive impact on the stock and bond markets and could potentially stem a tech-led sell-off in major indices,» Ozkardeskaya added.
COMPANIES AND OTHER MARKETS
On the business front, the earnings season continues to advance with the financial statements Tesla or Alphabetwhich will be announced this Tuesday. «The market vulnerability «It will be demonstrated that any weak figure and/or disappointment in the guides of any large technology company will translate into setbacks that could be significant and that would leave the market 'affected' for days,» commented Bankinter. Meanwhile, Verizon shares fall 6% this Monday after the company reported some Second quarter revenue of $32.796 billion, which fell short of expectationsset at 33.060 million, despite having improved the turnover of the same period of the previous year by 0.6%. Crowdstrike shares have also turned red (-11%)following the cybersecurity incident of its Falcon platform that affected, mainly, companies that use Microsoft services, such as the London Stock Exchange or, above all, airlines. In other markets, oil West Texas down 0.99% ($79.84) and the Brent fell by 0.90% ($81.93). For its part, the euro It appreciates 0.04% ($1.0882), and the ounce of gold loses 0.08% ($2,937). In addition, the 10-year US bond yield relaxes to 4.223% and the bitcoin adds 0.69% ($67,850).