By Florian Faust
NEW YORK (Dow Jones) — On Thursday, Wall Street was once once more dominated by the renewed escalation of the Ukraine conflict. While gold and bonds went up for the supposedly safe havens, share prices fell significantly. Neither the West nor Ukraine saw any evidence of the supposed partial withdrawal of Russian troops along the Ukrainian border. Instead, there was talk of an additional deployment of troops. US President Joe Biden classified the risk of a Russian invasion of Ukraine as “very high”.
The Dow Jones index fell 1.8 percent to 34,312 points, while the S&P 500 and Nasdaq Composite fell 2.1 and 2.9 percent, respectively. The 882 (Wednesday: 2,228) price winners faced 2,502 (1,138) losers. 90 (105) titles closed unchanged. News from eastern Ukraine of fighting between pro-Russian separatists and the Ukrainian army further fueled concerns. According to US Secretary of Defense Lloyd Austin, fighting in eastern Ukraine might give Russia an excuse to invade. Russian President Vladimir Putin called for the withdrawal of all US soldiers from Eastern and Central Europe.
Fear of war overshadows interest rate concerns
“This may be a bigger concern for NATO and the US as the separatists try to provoke a backlash from Ukrainian forces, creating a pretext for a Russian invasion and all hell broke loose,” warned market analyst Michael Hewson of CMC Markets the consequences of the fighting in eastern Ukraine.
In view of the escalation in Ukraine, the topics of interest rates and inflation receded completely into the background – this also applied to the economic data, which were somewhat weaker than expected. However, the deviations were not large enough to allay fundamental concerns regarding interest rates.
Gold at highest level since June 2021
The price of gold rose sharply with the geopolitical uncertainty – also fueled by lower market interest rates – and temporarily climbed above the $1,900 mark per troy ounce to its highest level since June 2021. If Russia invades Ukraine, the country will be removed from the global financial system be excluded. Then, many Russians fled to gold and the Central Bank of Russia might be forced to sell dollars and increase its gold reserves, an analyst said.
Investors also sought their salvation in the bond market, where prices rose sharply and yields fell – despite the expectation of rising key interest rates. The Japanese yen has served as a haven in uncertain times. The dollar was also slightly in demand as a safe haven, the dollar index rose by 0.1 percent.
On the other hand, the price of oil continued to fall, as it had on the previous evening, because the expected breakthrough in the nuclear negotiations with Iran brought additional oil onto the world market.
Cisco firmly – Nvidia very weak
Among the individual values, Cisco Systems increased by 2.7 percent. The telecom and network supplier performed better than expected in the second quarter and increased sales and earnings. The company spoke of improved demand across the range of products.
The chip manufacturer Nvidia reported record sales for the fourth quarter and also exceeded expectations. Nvidia announced further growth for the current quarter. Nevertheless, the share fell by 7.5 percent, with profit-taking likely to have played a role. Wells Fargo pointed to slightly weaker than predicted data center revenues.
In the first quarter of the business year, the semiconductor supplier Applied Materials exceeded market expectations in terms of earnings and sales despite persistent supply bottlenecks. The course turned 3.3 percent into the red with the weakness of the technology stocks. Walmart had raised the guidance above expectations and also increased the dividend. The stock advanced 4 percent.
The US Department of Transportation examines Tesla vehicles following customer complaints regarding unexpected braking – the titles lost 5.1 percent. DoorDash soared 10.7 percent following the grocery supplier saw sales jump — despite restaurants reopening. Nutria increased by 2.8 percent. The fertilizer manufacturer benefited from higher prices and strong demand in the fourth quarter.
Insurer American International Group (AIG) returned to profit in the fourth quarter. The paper rose by 1.7 percent. Hasbro advanced 2.1 percent. Activist investor Alta Fox Capital is trying to expand the toymaker’s board and is pushing for a spin-off of its fast-growing games division.
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INDEX last +/-% absolute +/-% YTD
DJIA 34.312,03 -1,8% -622,24 -5,6%
S&P-500 4.380,22 -2,1% -94,79 -8,1%
Nasdaq-Comp. 13.716,72 -2,9% -407,38 -12,3%
Nasdaq-100 14.171,74 -3,0% -431,90 -13,2%
US Bonds
Term Yield Bp to VT Yield VT +/-Bp YTD
2 years 1.46 -5.7 1.52 73.2
5 years 1.84 -7.9 1.92 58.2
7 years 1.93 -8.8 2.02 49.5
10 years 1.96 -7.9 2.04 45.1
30 years 2.29 -5.5 2.35 39.2
FOREX last +/- % Thu 9:13 Wed 18:49 % YTD
EUR/USD 1,1360 -0,1% 1,1381 1,1379 -0,1%
EUR/JPY 130,56 -0,6% 131,23 131,38 -0,3%
EUR/CHF 1,0455 -0,3% 1,0492 1,0488 +0,8%
EUR/GBP 0,8343 -0,4% 0,8371 0,8376 -0,7%
USD/JPY 114,93 -0,5% 115,31 115,46 -0,2%
GBP/USD 1,3617 +0,2% 1,3596 1,3586 +0,6%
USD/CNH (Offshore) 6,3339 +0,0% 6,3307 6,3332 -0,3%
Bitcoin
BTC/USD 40,936.09 -7.0% 43,980.24 43,629.13 -11.5%
ROHL last VT-Settl. +/- % +/- USD % YTD
WTI/Nymex 91,56 93,66 -2,2% -2,10 +22,3%
Brent/ICE 92,91 94,81 -2,0% -1,90 +19,9%
METALS last day before +/- % +/- USD % YTD
Gold (Spot) 1.898,38 1.869,92 +1,5% +28,46 +3,8%
Silver (Spot) 23.83 23.61 +0.9% +0.22 +2.2%
Platinum (Spot) 1,093.73 1,064.92 +2.7% +28.81 +12.7%
Kupfer-Future 4,50 4,54 -0,8% -0,04 +0,8%
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DJG / DJN / flf
(END) Dow Jones Newswires
February 17, 2022 16:08 ET (21:08 GMT)
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