NEW YORK (Dow Jones) — Soaring oil prices and unabated Russian attacks on Ukrainian cities weighed on Wall Street on Monday. Over the course of the year, prices increase their losses because the discussion about stopping Russian oil imports is fueling concerns about inflation.
The fact that negotiations are apparently continuing is currently not supported. On the one hand, representatives of Russia and Ukraine meet at the Ukrainian-Belarusian border. On the other hand, according to information from Moscow and Ankara, the foreign ministers of Russia and Ukraine will meet in Turkey on Thursday. The meeting of Sergei Lavrov and Dmytro Kuleba will take place in Antalya, said Turkish Foreign Minister Mevlt Cavusoglu. The government in Moscow confirmed this. According to the trade, the market is clutching at every straw in the Ukraine war.
Around noon (New York time), the Dow Jones index fell 1.8 percent, the S&P 500 and Nasdaq Composite lost 2.0 and 2.2 percent. As a result of the bear market, analysts at Citigroup lowered their year-end target for the S&P 500 to 4,700 from the previous 5,100 points. The oil price rally, which had previously had a massive impact, weakened somewhat with the headlines about the meeting at the government level of the war opponents.
Oil price rally weakens
Traders are talking of an oil price shock in view of the ever louder demands for a ban on imports of Russian oil and natural gas in the West. According to US Secretary of State Anthony Blinken, the US and its allies are considering a boycott of Russian oil imports. So far, the energy sector has been largely unaffected by the sanctions. Russia accounts for 45 percent of Europe’s gas imports, according to data from the International Energy Agency. With the debate about a Russian oil boycott, the price of the North Sea variety Brent shot up by around 10 percent to 139 US dollars per barrel – the barrel is currently being traded at 123 dollars.
However, there is no sign of the Russian aggressor in Ukraine giving in. The Russian army continues shelling Ukrainian cities unabated. Equita analyst Massimo Bonisoli says Russian oil is difficult to replace. “Obviously, galloping commodity prices will put pressure on the economy,” adds Saxo Bank’s equity strategist Peter Garnry, citing the already high level of inflation.
Safe havens are growing
With the heavier losses on the stock market, investors are again switching to supposedly safe havens such as gold. A troy ounce had meanwhile cost more than 2,000 dollars, but the price is now trading below this mark again, but it is still slightly up. Rising market interest rates and the firm dollar are slowing the rise. In the gold trade, there are also warnings that Russia could throw parts of the gold reserves onto the market if revenues from raw material exports fall.
The dollar, as a safe haven currency, is growing somewhat more strongly, the dollar index gaining 0.5 percent. In the bond market, prices are even falling. The focus here is on rampant inflation with rising commodity and energy prices, and yields are rising as a result.
The energy sector is one of the few winners on the stock market. Among the l values, Exxon Mobil (2.4%) rise. Chevron (-1.2%) and Occidental Petroleum (-3.5%) turn negative as oil prices return. The fact that investment company Berkshire Hathaway, owned by investor legend Warren Buffett, has increased its stake in Occidental does not provide lasting support. Consumer and retail stocks tend to be under pressure, rising commodity and energy prices are likely to fuel inflation and weaken purchasing power.
Clover Health Investments even jumped 22.3 percent. Director Chelsea Clinton recently bought a larger stake in the company, whose share price has already plummeted by over 40 percent this year.
===
INDEX last +/-% absolute +/-% YTD
DJIA 32,996.50 -1.8% -618.30 -9.2%
S&P 500 4,240.65 -2.0% -88.22 -11.0%
Nasdaq Comp. 13,026.94 -2.2% -286.50 -16.7%
Nasdaq-100 13,532.60 -2.2% -305.23 -17.1%
US Bonds
Term Yield Bp to VT Yield VT +/-Bp YTD
2 years 1.55 +6.4 1.48 81.8
5 years 1.71 +6.9 1.64 44.7
7 years 1.77 +6.4 1.70 32.5
10 years 1.79 +6.1 1.73 28.1
30 years 2.19 +3.3 2.16 29.2
FOREX last +/- % Mon 8:34 Fri 17:27 % YTD
EUR/USD 1.0866 -0.5% 1.0884 1.0918 -4.4%
EUR/JPY 125.38 -0.1% 125.27 125.29 -4.2%
EUR/CHF 1.0066 +0.4% 1.0023 1.0030 -3.0%
EUR/GBP 0.8284 +0.3% 0.8234 0.8260 -1.4%
USD/JPY 115.36 +0.4% 115.09 114.78 +0.2%
GBP/USD 1.3116 -0.9% 1.3219 1.3215 -3.1%
USD/CNH (Offshore) 6.3270 +0.1% 6.3226 6.3276 -0.4%
Bitcoin
BTC/USD 38,734.11 -0.6% 37,975.49 40,637.22 -16.2%
ROHOEL last VT-Settl. +/- % +/- USD % YTD
WTI/Nymex 117.81 115.68 +1.8% 2.13 +58.2%
Brent/ICE 122.34 118.11 +3.6% 4.23 +58.7%
METALS last day before +/- % +/- USD % YTD
Gold (Spot) 1,983.53 1,974.50 +0.5% +9.03 +8.4%
Silver (Spot) 25.46 25.72 -1.0% -0.26 +9.2%
Platinum (Spot) 1,128.51 1,118.50 +0.9% +10.01 +16.3%
Copper Future 4.71 4.93 -4.5% -0.22 +5.5%
Copper Future 4.78 4.93 -3.1% -0.15 +7.0%
===
Contact the author: [email protected]
DJG/DJN/cln/mgo
(END) Dow Jones Newswires
March 07, 2022 12:19 ET (17:19 GMT)
Leverage must be between 2 and 20
No data