Wall Street falls despite good news

The news of lower-than-expected inflation in the US in May, as well as President Donald Trump's announcement of an agreement with China after two days of negotiations in London, did not translate into a steady increase in US stock markets during Wednesday's session. Demand fought to maintain the initiative until the midway point of the session. However, supply took over after that. Investors sold shares of the largest technology companies, which usually depresses the market, taking profits from the three previous sessions, during which the so-called Magnificent Seven index rose by over 4%. Among the reasons for the increased supply of shares despite the good news, the closeness of the S&P500 to a record level, after three previous sessions of growth in a row, as well as reports from The Wall Street Journal that the agreement with China on the resumption of supplies of rare earth elements is to last only for 6 months, were indicated.

The debt market has had a very good day. First, US bonds rose after inflation data raised the probability of the Fed cutting rates in September to 75 percent. Then, an additional "bullish" impulse was the successful auction of 10-year US bonds worth USD 39 billion, which improved the mood after Tuesday's unsuccessful auction of 3-year US bonds and before Thursday's auction of 30-year bonds.

Two-thirds of S&P500 companies ended the day with a decline in price. Intel (-6.3%), whose value had increased by over 8% in the previous three sessions, was the biggest loser. Another company that was among the most heavily discounted was the defense company Lockheed Martin (-4.2%). The sell-off in its shares came after reports that the US military had halved its order for F-35 aircraft. Ultimately, supply prevailed in 7 of the 11 main segments of the S&P500. The biggest declines were recorded by consumer discretionary goods companies, materials (-1.0% each) and telecommunications services (-0.6%). The only segment to grow significantly was energy (1.5%), which resulted from the largest increase in oil prices in 8 months after reports suggesting a growing threat of conflict in the Middle East.

Although the Dow Jones Industrial Average ended the session with zero change, the value of 20 of its 30 companies fell. The biggest declines were recorded by Home Depot (-2.1%), Amazon.com (-1.9%) and Apple (-1.8%). The biggest increases were recorded by UnitedHealth, IBM (1.7% each) and Goldman Sachs (1.4%).

The prices of almost 60% of over 3 thousand companies from the Nasdaq Composite fell. Among those with the largest capitalization, only Microsoft (+0.3%) did not fall. The index of the "magnificent seven" ended the session down 0.8%, with the biggest declines being caused by the decreases in the prices of Amazon.com (-1.9%) and Apple (-1.8%).

Despite the deterioration in sentiment in the second half of the session, shares of companies from the quantum computing industry enjoyed consistently high demand until the end of the session. Shares of Rigetti Computing (11.4%) and Quantum Computing (25.4%), among others, rose after Nvidia CEO (-0.8%) Jensen Huang announced on Wednesday at a conference in Paris that quantum computers had already reached a breakthrough point.