Friday February 25th

U.S. stock market index futures rose Friday, erasing losses earlier in the session, as investors continued to assess the risks stemming from Russia’s invasion of Ukraine. Futures on the Dow Jones Industrial Average added about 140 points, or 0.4%. Dow futures were down nearly 300 points at their lows. S&P 500 futures inched up 0.5% and Nasdaq 100 futures rose 0.7%. “With a broader Russian invasion of Ukraine underway, the potential geopolitical, economic, and asset implications of the conflict between Russia and the West over Ukraine are once again Top of Mind,” Goldman Sachs’ Allison Nathan said in a note. Russia is closing in on the Ukrainian capital of Kyiv, according to Ukrainian officials. The capital had been hit by “horrific Russian rocket strikes,” Ukrainian Foreign Minister Dmytro Kuleba said. That came a day after U.S. Secretary of State Antony Blinken told CBS that Kyiv “could well be under siege” soon. Government bond yields were slightly higher Friday after falling Thursday. Yields move opposite prices. The benchmark 10-year Treasury note yield on Friday ebbed around 2%. On the data front, the core personal consumption expenditures price index, the Federal Reserve’s primary inflation gauge, rose 5.2% from a year ago, the Commerce Department reported Friday. Economists surveyed by Dow Jones expected a 5.1% print. During Thursday’s regular trading session, the market was initially spooked by Moscow’s invasion of Ukraine using land, air and naval forces. The S&P 500 was down as much as 2.6% during the session but closed up 1.5% higher despite the outbreak of violence. The blue-chip Dow ended the day about 90 points higher after losing 859 points at its session low. The tech-heavy Nasdaq Composite rallied 3.3% in a stunning comeback after dropping nearly 3.5% at the lowest level of the day. “Russia invading Ukraine has added to an already tense year, with investors selling first and asking questions later,” said LPL Financial Chief Market Strategist Ryan Detrick. “But it is important to know that past major geopolitical events were usually short-term market issues, especially if the economy was on solid footing.” President Joe Biden rolled out a new wave of sanctions against Russia on Thursday afternoon in a broad effort to isolate Moscow from the global economy. The White House has also authorized additional troops to be stationed in Germany as NATO allies look to bolster defenses in Europe, Biden said. Despite Thursday’s wild intraday reversal, major averages are on track for their third negative week in a row amid escalated geopolitical tensions and worries over monetary policy. The Dow is down 2.5% this week, on pace for its worst weekly performance since Jan. 21. The S&P 500 and the Nasdaq have fallen 1.5% and 0.6% this week, respectively. All three averages are still in correction territory, or down 10% or more from their respective record highs. The Nasdaq opened Thursday’s session in bear market territory, down more than 20% from its record high in November. “While there may be some additional volatility in the short term, these dislocation events historically present opportunities, as long as recession doesn’t follow,” said Cliff Hodge, CIO at Cornerstone Wealth. “Higher energy prices will also support sticky inflation which may keep pressure on the Fed to stay on course.” Shares of Beyond Meat tumbled more than 10% in early morning trading Friday after the alternative meat producer reported a wider-than-expected loss and shrinking revenue for its fourth quarter. Japan’s Nikkei 225 was up 1.95% at 26,476.50 at the close, while the Topix gained 1% to 1,876.24. Elsewhere, in South Korea, the Kospi rose 1.06% to 2,676.76 and the Kosdaq added 2.92% to 872.98. The Shanghai composite in mainland China added 0.63% to close at 3,451.41, and the Shenzhen component jumped 1.21% to 13,412.92. Hong Kong’s Hang Seng index declined 0.56% in Friday afternoon trade. Oil prices slipped on Friday after sharp rises earlier in the session on concern over potential global supply disruptions from sanctions on major crude exporter Russia. The April Brent crude futures contract was down $1.49, or 1.5%, at $97.59 a barrel, after climbing as high as $101.99. The more active May contract shed 93 cents, or 1%, to $94.48. U.S. West Texas Intermediate (WTI) crude was down 60 cents to $92.25 a barrel, after hitting a session high of $95.64. Russia’s invasion of Ukraine on Thursday caused prices to surge above $100 a barrel for the first time since 2014, with Brent touching $105, before paring gains by the close of trade. Gold prices dipped on Friday after a volatile session the previous day saw prices soaring to 18-month highs before closing lower, as Moscow’s invasion of Ukraine continued. Spot gold fell 0.7% to $1,889.54 per ounce. U.S. gold futures shed 1.7% to $1,893.50 per ounce. Prices of the safe-haven metal rallied over 3% to as high as $1,973.96 after Russia attacked Ukraine by land, air and sea on Thursday. Missiles pounded the Ukrainian capital on Friday.