Monday March 21st

U.S. stock market index futures were little changed in early morning trading Monday after the benchmark index’s best week since 2020. Dow Jones Industrial Average futures edged down about 40 points, or 0.2%, as Boeing dropped more than 4% in the premarket after a China Eastern Airlines Boeing 737 passenger plane crashed. S&P 500 futures were near flat. Nasdaq 100 futures ticked down 0.3%. Last week, the three major averages notched their best week since November 2020, boosted largely by growth stocks. The S&P 500 surged 6.1% from Monday to Friday. The Dow Jones Industrial Average ended the week 5.5% higher, and the technology-focused Nasdaq Composite spiked 8.1%. “After one of the best weeks in years, now the question is will stocks be able to hold those gains?” said Ryan Detrick of LPL Financial. The S&P 500 recouped nearly half of its correction losses last week as investors received highly anticipated clarity from the Federal Reserve, which raised interest rates for the first time since 2018. The central bank signaled it expects to raise rates at its remaining six meetings this year. Market participants are also monitoring the war between Russia and Ukraine. Ukraine’s President Volodymyr Zelenskyy warned if peace talks with Russian leader Vladimir Putin fail, it would mean the start of a “third world war.” Ukrainian and Russian officials have met intermittently for peace talks, which have failed to progress to key concessions. Ukraine has also rejected an ultimatum to surrender the city of Mariupol to Russian troops. Oil prices rose about 4% on Monday, with Brent crude above $110 a barrel, as European Union nations considered joining the U.S. in an embargo on Russian oil. Investors are also evaluating a rise in Covid cases in Europe stemming from an emerging variant. Some market strategists are not convinced of the rally in stocks. “Bear market rallies are the most vicious. The rally in equities over the past week was one of the sharpest on record. While it could go a bit higher ... we remain convicted it’s still a bear market and we would use this strength to position more defensively,” Morgan Stanley’s Michael Wilson said in a note Monday. The economic calendar is relatively light this week but several companies report earnings. Nike and Tencent Music report quarterly results on Monday. Shares in Asia-Pacific were mixed on Monday as investors reacted to the release of China’s latest benchmark lending rate, while oil prices surged 4%. Hong Kong’s Hang Seng index, which rose more than 1% in early trade, erased gains and closed 0.89% lower at 21,221.34. The city’s benchmark index finished more than 4% higher last week following a volatile week which swung between big gains and losses. Mainland Chinese stocks, on the other hand, closed in positive territory. The Shanghai composite rose fractionally to 3,253.69 and the Shenzhen component advanced 0.414% to 12,379.64. Elsewhere in the region, the S&P/ASX 200 in Australia dipped 0.22% on the day to 7,278.50 while South Korea’s Kospi shed 0.77%, closing at 2,686.05. Markets in Japan were closed on Monday for a holiday. Oil prices jumped $3 on Monday, with Brent above $110 a barrel, as European Union nations consider joining the United States in a Russian oil embargo, while a weekend attack on Saudi oil facilities caused jitters. Brent crude futures climbed 4.3% to $112.55 per barrel, adding to a 1.2% rise last Friday. U.S. West Texas Intermediate (WTI) crude futures rose 4.6% to $109.37, extending a 1.7% jump last Friday. Gold prices edged up on Monday as fighting in Ukraine buoyed demand for the safe-haven asset, although strength in U.S. bond yields restricted bullion’s gains. Spot gold was up 0.3% at $1,926.46 per ounce by 1110 GMT. U.S. gold futures were down 0.2% at $1,925.90.