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The market does not accept the rate increase

The rate increases so far have not made a dent in the stock markets, which are at a record.

The market does not assume the consequences of rate increases. Higher rates mean less money in citizens’ pockets because the mortgage loan on their home is more expensive, and therefore less consumption. This, of course, is not an immediate phenomenon, but it is gradually spreading.

Investors continue to pay attention to the corporate earnings season. In the case of large American banks, Bank of America (NYSE:BAC) is trying to recover this Wednesday on the stock market after falling yesterday after failing to convince shareholders with its presentation of results for the first quarter of 2024.

The bank recorded a significant decline in profits, with an 18% reduction in net profit, falling from $8.2 billion to $6.7 billion. “This setback is mainly due to a 3% drop in interest payment income, which fell to $14 billion. Despite this decline, the bank managed to mitigate the impact thanks to improved performance in the areas of commerce and wealth management”

Bank of America is an example, which we will see more about shortly. Companies’ results will be reduced.

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