© Reuters. New York stocks advance, eyeing the war in Ukraine and oil
New York stocks closed robustly higher on Tuesday, with investors attentive to the unfolding of the war in Ukraine and the sharp decline in prices, which returned to operating below US$ 100 per barrel in the futures market, relieving some of the pressure. on inflationary expectations. The movement in the stock market takes place on the eve of the decision that should mark the (Fed’s) first interest rate hike since the beginning of the coronavirus crisis.
The index ended the session with an advance of 1.82%, at 33,544.34 points, accumulated a rise of 2.14%, at 4,262.45 points, and closed it with a gain of 2.92%, at 12,948.62 points. .
Leading portfolio strategist at Natixis Investment Managers Solutions, Jack Janasiewicz mentions in a comment to Dow Jones Newswires that there is a “negative correlation” in the market, in which the rise in oil tends to cause losses in the stock market, and vice versa. “If oil drops to pre-Russian levels of Ukraine, that will give us a little more confidence that inflation is not spiraling out of control and making things more difficult for the Fed,” says the economist.
On Wednesday, the US central bank should start the interest rate hike cycle with an increase of 25 basis points in the interest rate, to a level between 0.25% and 0.50% per year, according to analysts consulted by Broadcast. , Grupo Estado’s real-time news system. Still on the BC, economist Sarah Bloom Raskin decided to withdraw her candidacy for the position of head of the Fed, after Republican opposition. According to US President Joe Biden, she was the target of “baseless attacks”.
Earlier, the stock market on Wall Street was boosted by the prospect of resumption of Russian-Ukrainian talks for a deal that would peacefully end the conflict in Eastern Europe. According to Ukrainian President Volodymyr Zelensky, talks would continue on Tuesday. During the day, however, there were no signs of significant progress in the negotiations.
The slightly lower-than-expected advance of the US producer price index (PPI) in February also gave strength to the US producer price index (PPI), which rose 0.8% compared to January.
The Oxford Economics assessment does not follow market optimism when looking at the data. “Inflation at source is showing little sign of slowing down in the short term, especially as the war wreaks havoc on energy markets. Higher input costs will keep producer prices frustratingly high and continue to squeeze profit margins, likely fueling consumer prices until war tensions subside and demand for goods calms down,” the consultancy predicts in a report.
Among individual stocks, airlines such as United Airlines (NASDAQ:), American Airlines (NASDAQ:) and Delta Air Lines stood out this Tuesday, with increases between 8% and 9%. Amazon (NASDAQ:) (+3.89%), Microsoft (NASDAQ:) (+3.87%) and Apple (NASDAQ:) (+2.97%) also performed well. the oil companies Exxon Mobile (NYSE:) and chevron (NYSE:), on the other hand, followed the decline in the energy commodity and ended the day with losses of 5.69% and 5.06%, respectively.