US Shares and Bond Yields Fall – Ukraine Pressure Endure
Shares and bond yields on Wall Street fell sharply on Thursday; Growing concern that Russia might invade Ukraine; hence, Global financial markets have been shaken. The S&P 500 fell 2.1%. This is Its most significant drop in two weeks; The first drop in three days. The Dow fell more than 600 points. Nasdaq composite even 2.9%. The loss destroyed the weekly gains of the major indexes.
About 85% of the shares of the benchmark S&P 500 closed lower. The technology sector was the most significant pressure on the index—communications stocks and companies rely on consumer spending. Microsoft dropped 2.9%. Meta by 4.1%; Nike by 2.5%. Bond yields fell and brought the banks down. 10-year treasury yields fell to 1.97%. Bank of America decreased 3.4%. European markets, which were particularly sensitive to tensions in Ukraine, closed down.
Russia built up 150,000 troops near the Ukrainian border. Biden said that Russia might invade in a few days. Hence, the sales wave has since arrived. Senior officials fought for decisions; However, suspicions between East and West only grew. NATO allies have denied Russia’s allegations; Which reinforced the fear of attack.
The S&P 500 fell 94.75 points to 4,380.26. The index is 8.7% lower than the all-time figure recorded in January. The Dow fell to 34,312.03, or 1.8%, for a total of 622.24 points. The Nasdaq hit 13.716.72 and lost 407.38 points. Shares of small companies also dropped significantly. The Russell 2000 Index dropped to 2,028.09, or 2.5% overall.
Ukraine Tension – Shares
Markets in Ukraine have not been closed for weeks due to tensions. The potential for military conflict in Europe forced volatile trade in energy markets. Russia is a significant producer of energy. Military conflict can disrupt supplies and needs. The price of crude oil in the US fell by 2%. Natural gas dropped by 4.9%.
If Russia invades Ukraine and responds with US and Western economic sanctions; This could hinder access to about 7% of the global energy market. The price of gold, during geopolitical uncertainty, increased by 1.6%. Tensions over Ukraine have only added to investors’ concerns. The Fed is preparing to boost interest rates to cope with ever-increasing inflation.
Wall Street was looking for clues about how fast the central bank will start raising interest rates. The minutes of the last meeting of the federation officials, published on Wednesday, showed; Most policymakers suggest that a faster short-term benchmark interest rate growth would likely be guaranteed.
Inflation reached a 40-year high. Companies are dealing with supply chain problems and higher costs for consumers by raising prices on finished goods. Many have also warned investors that sales, profits, and total operations will still suffer due to inflation. The move to raise prices for goods heightened concerns; That consumers may eventually reduce costs. This could hurt economic growth. According to the latest Commerce Department report, retail sales rose 3.8% in January.
Wall Street is also considering the latest round of corporate account cards. Walmart grew by 4% after the announcement of strong financial results for the fourth quarter. Cisco Systems gained 2.8% since the profit forecast increased over the years.
