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Wall Street closed sharply lower on Friday following heightened geopolitical tension between Russia and Ukraine. U.S. stocks tumbled in the last hour of trading after a day-long choppy sessions as White House raised alarm. Weak economic data also dented investors’ confidence. All three major stocks indexes ended in red. For the week as a whole, these indexes finished in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) dropped 1.4% or 503.53 points to close at 34,738.04. Notably, 26 components of the 30-stock index ended in red while 4 in green.
The tech-heavy Nasdaq Composite finished at 13,791.15, plummeting 2.8% or 349.49 points due to weak performance by large-cap technology stocks. The index’s decline was accelerated due to market participants’ concern about higher-than-expected hike intertest rate by the Fed in March.
Meanwhile, the S&P 500 slid 1.9% to end at 4,418.64. Nine out of eleven sectors of the benchmark index closed in negative territory while two in green. The Communication Services Select Sector SPDR (XLC), the Consumer Discretionary Select Sector SPDR (XLY) and the Technology Select Sector SPDR (XLK) plunged 2.2%, 2.9% and 3.1%, respectively. However, the Energy Select Sector SPDR (XLE) surged 2.9%.
The fear-gauge CBOE Volatility Index (VIX) was up 14.4% to 27.36. A total of 13.4 billion shares were traded on Friday, higher than the last 20-session average of 12.6 billion. Decliners outnumbered advancers on the NYSE by a 2.40-to-1 ratio. On Nasdaq, a 2.54-to-1 ratio favored declining issues.
Russia – Ukraine Geopolitical Conflict Intensifies
Stocks fell sharply after White House warned that Russia may enter the geographical territory of Ukraine soon. Any Americans still in Ukraine should leave “immediately,” the White House said. U.S. National Security Advisor Jake Sullivan said that Russia has escalated its military positions in Ukraine border and might enter the bordering country any day even possibly even during the Winter Olympics.
Consequently, market participants have dumped risky assets like equities and opted for safe-haven government bonds. As a result, the yield on the benchmark 10-Year U.S. Treasury Note fell up to 1.9% before settling at 1.951%. The yield was hovering above 2% throughout the week on concerns of higher-than-expected hike in interest rate by the central bank in March.
Following White House communique, crude oil prices jumped globally. The U.S. benchmark - West Texas Intermediate crude for March delivery rose 3.6% to close at $93.10 a barrel on the New York Mercantile Exchange. For the week, the WTI crude rose 0.9%, its highest finish for a front-month contract since September 2014.
The global benchmark – Brent crude for April delivery rose 3.3% to end at $94.44 a barrel on ICE Futures Europe. For the week, the Brent crude rose 1.3%, its highest finish for a front-month contract since September 2014.
The University of Michigan reported that the preliminary data for the U.S. consumer sentiment index for February came in at 61.7, its lowest reading since October 20211. The consensus estimate was 67.4 and the final reading of January was 67.2.
Expectations for inflation over the next year came in at 5% from 4.9% in January, marking the highest level since July of 2008. However, expectations for inflation over next five years remained same at 3.1%. The current condition index dropped to 68.5 in February from 72 in January. The expectations index slid to 57.4 in February from 64.1 in January.
Weekly Roundup
The last week was a disappointing one for Wall Street as market participants dumped equities fearing higher-than-expected interest rate hike in March. The three major stock indexes – the Dow, the S&P 500 and the Nasdaq Composite – declined 1%, 1.8% and 2.2%, respectively.
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Stock Market News for Feb 14, 2022
Wall Street closed sharply lower on Friday following heightened geopolitical tension between Russia and Ukraine. U.S. stocks tumbled in the last hour of trading after a day-long choppy sessions as White House raised alarm. Weak economic data also dented investors’ confidence. All three major stocks indexes ended in red. For the week as a whole, these indexes finished in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) dropped 1.4% or 503.53 points to close at 34,738.04. Notably, 26 components of the 30-stock index ended in red while 4 in green.
The tech-heavy Nasdaq Composite finished at 13,791.15, plummeting 2.8% or 349.49 points due to weak performance by large-cap technology stocks. The index’s decline was accelerated due to market participants’ concern about higher-than-expected hike intertest rate by the Fed in March.
Meanwhile, the S&P 500 slid 1.9% to end at 4,418.64. Nine out of eleven sectors of the benchmark index closed in negative territory while two in green. The Communication Services Select Sector SPDR (XLC), the Consumer Discretionary Select Sector SPDR (XLY) and the Technology Select Sector SPDR (XLK) plunged 2.2%, 2.9% and 3.1%, respectively. However, the Energy Select Sector SPDR (XLE) surged 2.9%.
The fear-gauge CBOE Volatility Index (VIX) was up 14.4% to 27.36. A total of 13.4 billion shares were traded on Friday, higher than the last 20-session average of 12.6 billion. Decliners outnumbered advancers on the NYSE by a 2.40-to-1 ratio. On Nasdaq, a 2.54-to-1 ratio favored declining issues.
Russia – Ukraine Geopolitical Conflict Intensifies
Stocks fell sharply after White House warned that Russia may enter the geographical territory of Ukraine soon. Any Americans still in Ukraine should leave “immediately,” the White House said. U.S. National Security Advisor Jake Sullivan said that Russia has escalated its military positions in Ukraine border and might enter the bordering country any day even possibly even during the Winter Olympics.
Consequently, market participants have dumped risky assets like equities and opted for safe-haven government bonds. As a result, the yield on the benchmark 10-Year U.S. Treasury Note fell up to 1.9% before settling at 1.951%. The yield was hovering above 2% throughout the week on concerns of higher-than-expected hike in interest rate by the central bank in March.
Following White House communique, crude oil prices jumped globally. The U.S. benchmark - West Texas Intermediate crude for March delivery rose 3.6% to close at $93.10 a barrel on the New York Mercantile Exchange. For the week, the WTI crude rose 0.9%, its highest finish for a front-month contract since September 2014.
The global benchmark – Brent crude for April delivery rose 3.3% to end at $94.44 a barrel on ICE Futures Europe. For the week, the Brent crude rose 1.3%, its highest finish for a front-month contract since September 2014.
Consequently, shares of oil giants like Exxon Mobil Corp. (XOM - Free Report) , Devon Energy Corp. (DVN - Free Report) and ConocoPhillips (COP - Free Report) have rallied 2.5%, 3.6% and 2.3%, respectively. ConocoPhillips and Exxon Mobil currently carry a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Economic Data
The University of Michigan reported that the preliminary data for the U.S. consumer sentiment index for February came in at 61.7, its lowest reading since October 20211. The consensus estimate was 67.4 and the final reading of January was 67.2.
Expectations for inflation over the next year came in at 5% from 4.9% in January, marking the highest level since July of 2008. However, expectations for inflation over next five years remained same at 3.1%. The current condition index dropped to 68.5 in February from 72 in January. The expectations index slid to 57.4 in February from 64.1 in January.
Weekly Roundup
The last week was a disappointing one for Wall Street as market participants dumped equities fearing higher-than-expected interest rate hike in March. The three major stock indexes – the Dow, the S&P 500 and the Nasdaq Composite – declined 1%, 1.8% and 2.2%, respectively.