Inflation Concerns Boost New York Stocks and Gold Up... Cryptocurrency Declines

[Asia Economy New York=Correspondent Baek Jong-min] The New York stock market closed higher despite inflation concerns. Gold prices entered the $1900 range, while cryptocurrency prices fell across the board.

[Image source=Reuters Yonhap News]

On the 28th (local time), the Dow Jones Industrial Average rose 64.81 points (0.19%) to close at 34,529.45, the S&P 500 index increased by 3.23 points (0.08%) to 4,204.11, and the Nasdaq index rose 12.46 points (0.09%) to 13,748.74.

The weekly gains were 1% for both the Dow and S&P 500, and 2% for the Nasdaq.

On a monthly basis, the Dow and S&P 500 rose 1.9% and 0.6% respectively, continuing their gains for four consecutive months. The Nasdaq fell 1.5% in May.

The market's behavior that day ran counter to expectations that the April core Personal Consumption Expenditures (PCE) index would stoke inflation fears.

April PCE rose 0.6% month-over-month and 3.6% year-over-year. The April core PCE index, which excludes volatile food and energy prices, increased 0.7% month-over-month and 3.1% year-over-year.

Although the PCE growth rate was higher than market expectations, it was perceived as lower compared to the 4.2% rise in the April Consumer Price Index (CPI). This perception influenced a decline in Treasury yields. The 10-year U.S. Treasury yield dropped from 1.609% the previous day to the 1.5% range.

The rise in PCE was reflected in inflation hedge demand, pushing gold prices higher. At the New York Mercantile Exchange, August gold futures rose $6.80 (0.4%) to $1,905.30. Gold has risen 8% this month alone, successfully re-entering the $1900 range. This is the highest level in 10 months.

Despite the strength in gold prices, cryptocurrencies, often called 'digital gold' such as Bitcoin, mostly declined.

Bitcoin fell 8.4% to the $35,000 range, Ethereum dropped 10% to the $2,400 range, and Dogecoin declined 5% to 31 cents.

Cryptocurrency exchange Coinbase fell 4.2%. Tesla declined 0.89%.

The 'meme stocks' that showed strong gains this week entered a correction phase. Theater chain AMC's stock surged more than 38% intraday but then fell over 8% at one point, showing extreme volatility before closing down 1.5%. GameStop's stock also rose more than 5% intraday but closed down 12%.

Semiconductor stocks were uniformly strong. Nvidia led with a 5% rise, followed by Broadcom, Texas Instruments, and Analog Devices, each up about 1%.

July West Texas Intermediate (WTI) crude oil fell 53 cents (0.8%) to close at $66.32 per barrel.

This content was produced with the assistance of AI translation services.