US Dollar On The Rise Again
United States stocks were a little lower on Tuesday, changing the direction in the second part of the session, with the optimistic expectation about the US dollar strength news came in.
Monday gains were led by the S&P utilities sector, which closed 1.1% under the previous result, representing S&P 500’s biggest drag.
On Tuesday afternoon, United Stated dollar reached its peak, showing signs of recovery, following the losses in the recent days. The US earnings are again under the pressure of the strengthening dollar, which cause some concern with the investors.
Wilmington Trust’s chief investment officer, Tony Roth said in Delaware that “If the (dollar) move is gradual it shouldn’t impact stocks too much, as companies will have a chance to hedge against the impact, but a sharp rise will have an impact.”
During the session, the stocks were out of the red most of the time, lifted by the news suggesting that majority of the companies is still seeing some value in the market.
FedEx shares went up by 2.7%, reaching the value of 171.16 US dollars, as the company is said to be in the process of buying TNT Express, the package delivery company in the Netherlands for 4.8 billion US dollars.
The same company, TNT Express was the target of UPS two years ago, but the competition regulators blocked the sale, as UPS already had a significant European presence.
String dollar signifies solid fundamentals, but the analysts share a concern that the strong dollar could weigh the US multinational companies’ earnings. GM shares went down by 2.5%, reaching 35.73 US dollars in the session, as Canada sold almost 73 and a half million shares of General Motors to Goldman Sachs.
Twitter shares rose 4% and finished the session at 52.87 US dollars, a six months record high, with announcements that Twitter is going to reject the takeover bid.