The recovery was expected after the last session’s technical rebound and after the collapse of previous sessions known as Black Thursday for some analysts, where in addition the most liquid and diversified indicator to the world, Dow Jones, dropped 4.15%, which means about 1,000 points interday.
According to the experts who were consulted on the subject of the announcement made by the president of the central banking system for the United States, the FED, William Dudley commented that to raise the types of short-term interests as of March, he warned the banks, the funds and other speculators because the cost of the money increases, the consumption drops and the gains of the companies are affected.
On the other hand, a source in Mexico commented that the expectation of which a greater cost of the money can affect the corporative gains and stop the internal consumption is one of the main causes of this collapse.
After nine days, the debacle amounted to an aggregate of approximately 10% according to Dow Jones metrics.
Meanwhile, an analysis done by El Financiero, from Mexico, reviewed that Wall Street fear of the greater interest rates already did its purpose. In the last days, Dow Jones accumulated a 10% drop, which has been the most aggressive adjustment in the last few years.
On the other hand, the analysts and experts in the area who were consulted on the matter give account of which the market was the one that generated the nervousness and that in addition caused the selling outburst in the session.
According to the report of the Financier, the fear of the investors dealt an important blow in the market of the debt after which the rates of American bonds of 10 years had increased to the maximums of last the four years, to be located in a 2.85%.
Nevertheless and as we commented before, the behavior of the different agents from the market, regarding the different expectations from the rise of the rates of references of the United States, all this against the strength of the economy in use questions, the inflation or the systems of prices, helped to contribute rally of the balances in Wall Street.
In addition, we must to add other variable, the report of the Department of Work, where this was confirmed that there was an accelerated increase of the different real wages, could create some stimuli on the variation of the systems of prices and with this a very important and probable effect on the growth to medium term.
This, from the point of view of banks and funds, threatens the short-term issuing companies’ profits and lists the stock markets.