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U.S. stock markets closed lower on Thursday as market participants continued to asses Russian invasion in Ukraine. Technology sector suffered as Fed Chairman said that rate hike is imminent in March despite geopolitical uncertainty. Moreover, the yield on government bonds steadied after three days of decline. All three major stock indexes ended in red.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 0.38% to close at 33,794.66. 15 component of the 30-stock index ended in red while 15 finished in positive zone.
The tech-heavy Nasdaq Composite finished at 13,537.94, sliding 1.6% or 214.07 points due to the weak performance of large-cap technology stocks. Meanwhile, the S&P 500 dropped 0.5% to end at 4,363.49. However, 7 out of 11 broad sectors of the benchmark index closed in positive territory and 4 in negative zone.
The Technology Select Sector SPDR (XLK), the Consumer Discretionary Select Sector SPDR (XLY) and the Communication Services Select Sector SPDR (XLC) declined 1.2%, 2.3% and 1%, respectively. On the other hand, the Utilities Select Sector SPDR and the Real Estate Select Sector SPDR (XLRE) gained 1.8% and 1.1%, respectively.
The fear-gauge CBOE Volatility Index (VIX) was down 0.9% to 30.48. A total of 12.6 billion shares were traded on Thursday, lower than the last 20-session average of 12.7 billion. Decliners outnumbered advancers on the NYSE by a 1.48-to-1 ratio. On Nasdaq, a 2.12-to-1 ratio favored declining issues.
Russia-Ukraine War Continues
The geopolitical conflict between Russia and Ukraine heightened as a massive Russian military convoy has approached the Ukrainian capital of Kyiv. The Russian authority has stepped up its shelling of Kharkiv, Ukraine’s second-largest city. The United States also deployed more troops in Europe.
Meanwhile, over the weekend, the U.S. and its allies agreed to exclude selected Russian banks from the SWIFT interbank messaging system. This measure will effectively detach Russian banks from the global financial network.
Technology Sector Falls
In his testimony to the U.S. House of Representatives and Senate Financial Services Committee, the Fed Chairman Jerome Powell said that the first rate hike after three years will come in March. However, he hinted that the central bank may not adopt an aggressive rate hike policy in order to combat soaring inflation as the “implications for the U.S. economy are highly uncertain” from the Russia - Ukraine war.
Consequently, the technology sector suffered as higher interest rate is detrimental to growth sectors like technology. Shares of Snowflake Inc. (SNOW - Free Report) and Okta Inc. (OKTA - Free Report) plummeted 15.4% and 8.1%, respectively. Snowflake carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The Department of Labor reported that weekly jobless claims decreased 18,000 to 215,000 for the week ended Feb 26, lower than the consensus estimate of 227,000. Previous week’s data was revised upward from 232,000 to 233,000. Continuing Claims (those who already received government benefit) for the week ended Feb 19, came in at 1.48 million. The four-week moving average, which smooths out weekly volatility, dropped to 1.54 million, the lowest level since Apr 4, 1970.
Unit labor cost in fourth-quarter 2021 increased by 0.9% compared with 0.3% in the previous quarter. The consensus estimate was 0.4%. Nonfarm productivity in fourth-quarter 2021 increased by 6.6% remained same with the previous quarter. The consensus estimate was 6%.
Factory orders (including durable and non-durable goods) in January increased 1.4% doubling the consensus estimate of 0.7%. December’s data was revised upward from a decline of 0.4% to a gain of 0.7%.
The Institute of Supply Management reported that Services Index for February dropped to a one-year low of 56.5% compared with January’s reading of 59.9% and the consensus estimate of 61%. Notably, any reading above 50% indicates expansion in services activities.
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Stock Market News for Mar 4, 2022
U.S. stock markets closed lower on Thursday as market participants continued to asses Russian invasion in Ukraine. Technology sector suffered as Fed Chairman said that rate hike is imminent in March despite geopolitical uncertainty. Moreover, the yield on government bonds steadied after three days of decline. All three major stock indexes ended in red.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 0.38% to close at 33,794.66. 15 component of the 30-stock index ended in red while 15 finished in positive zone.
The tech-heavy Nasdaq Composite finished at 13,537.94, sliding 1.6% or 214.07 points due to the weak performance of large-cap technology stocks. Meanwhile, the S&P 500 dropped 0.5% to end at 4,363.49. However, 7 out of 11 broad sectors of the benchmark index closed in positive territory and 4 in negative zone.
The Technology Select Sector SPDR (XLK), the Consumer Discretionary Select Sector SPDR (XLY) and the Communication Services Select Sector SPDR (XLC) declined 1.2%, 2.3% and 1%, respectively. On the other hand, the Utilities Select Sector SPDR and the Real Estate Select Sector SPDR (XLRE) gained 1.8% and 1.1%, respectively.
The fear-gauge CBOE Volatility Index (VIX) was down 0.9% to 30.48. A total of 12.6 billion shares were traded on Thursday, lower than the last 20-session average of 12.7 billion. Decliners outnumbered advancers on the NYSE by a 1.48-to-1 ratio. On Nasdaq, a 2.12-to-1 ratio favored declining issues.
Russia-Ukraine War Continues
The geopolitical conflict between Russia and Ukraine heightened as a massive Russian military convoy has approached the Ukrainian capital of Kyiv. The Russian authority has stepped up its shelling of Kharkiv, Ukraine’s second-largest city. The United States also deployed more troops in Europe.
Meanwhile, over the weekend, the U.S. and its allies agreed to exclude selected Russian banks from the SWIFT interbank messaging system. This measure will effectively detach Russian banks from the global financial network.
Technology Sector Falls
In his testimony to the U.S. House of Representatives and Senate Financial Services Committee, the Fed Chairman Jerome Powell said that the first rate hike after three years will come in March. However, he hinted that the central bank may not adopt an aggressive rate hike policy in order to combat soaring inflation as the “implications for the U.S. economy are highly uncertain” from the Russia - Ukraine war.
Consequently, the technology sector suffered as higher interest rate is detrimental to growth sectors like technology. Shares of Snowflake Inc. (SNOW - Free Report) and Okta Inc. (OKTA - Free Report) plummeted 15.4% and 8.1%, respectively. Snowflake carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The Department of Labor reported that weekly jobless claims decreased 18,000 to 215,000 for the week ended Feb 26, lower than the consensus estimate of 227,000. Previous week’s data was revised upward from 232,000 to 233,000. Continuing Claims (those who already received government benefit) for the week ended Feb 19, came in at 1.48 million. The four-week moving average, which smooths out weekly volatility, dropped to 1.54 million, the lowest level since Apr 4, 1970.
Unit labor cost in fourth-quarter 2021 increased by 0.9% compared with 0.3% in the previous quarter. The consensus estimate was 0.4%. Nonfarm productivity in fourth-quarter 2021 increased by 6.6% remained same with the previous quarter. The consensus estimate was 6%.
Factory orders (including durable and non-durable goods) in January increased 1.4% doubling the consensus estimate of 0.7%. December’s data was revised upward from a decline of 0.4% to a gain of 0.7%.
The Institute of Supply Management reported that Services Index for February dropped to a one-year low of 56.5% compared with January’s reading of 59.9% and the consensus estimate of 61%. Notably, any reading above 50% indicates expansion in services activities.