The Dow Jones Industrial Average has entered a correction and the oil price is picking up. Will this mean an end to bearish market conditions?
The “stock market today” is a term that describes the stock market. The Dow Jones industrial average entered into a correction on Wednesday, with oil jumping and stock futures rising.
A day after worries of a recession forced the Dow Jones Industrial Average into a correction, stock futures edged upward, as bond rates and oil prices surged.
Futures tied to the S&P 500 edged up 0.5% Tuesday, while blue-chip Dow Jones Industrial Average futures rose 0.4%. Futures linked to the technology-heavy Nasdaq-100 were flat. Overseas, the Stoxx Europe 600 rose 0.8% led by its financial and utilities sectors.
Brent crude, the international oil benchmark, rose over 3% to $126.77 a barrel on worries of a United States embargo on Russian supplies.
Investors are trying to assess the potential long-term consequences of Russia’s invasion of Ukraine and the hardening of Western responses. Market volatility has risen as ties between the West and Russia have reached new lows, while skyrocketing commodity prices have increased the possibility of a slowdown in global growth, clouding the picture for central banks aiming to control inflation by hiking interest rates.
Despite a strong demand for safe-haven assets, speculators liquidated US Treasury notes on Tuesday. The 10-year note’s yield increased to 1.859 percent from 1.748 percent on Monday. Bond yields and prices are inversely proportional.
“While there is still a safe-haven trade,” Seema Shah, chief strategist at Principal Global Investors, said, “it is being swamped by inflation fears.”
Gold rose 1% to $2,014.90 per troy ounce, closing within a whisker of its all-time high.
Mandiant’s stock dropped about 4% before the opening bell after Alphabet’s Google announced that it had agreed to purchase the cybersecurity business for $5.4 billion. Uber’s stock gained 1.6 percent after The Wall Street Journal reported that the ride-hailing business was initiating a campaign to prevent its workers from being classified as employees, allowing them to organize unions.
On Monday, the Dow Jones index slipped into correction territory for the first time in two years, the Nasdaq Composite index fell into a bear market and the S&P 500 experienced its worst one day decline in about a year-and-a-half.
“I’d say the market is in shock right now.” Everyone is second-guessing what the end game may be, given the seismic upheaval we’ve witnessed,” said Brian O’Reilly, head of market strategy at Mediolanum International Funds.
For the first time in two years, the Dow Jones Industrial Average closed in correction territory on Monday.
Courtney Crow/Zuma Press photo
Because of Russia’s disproportionate position as a resource producer, the effect has been most pronounced in commodities markets. Prices for oil, natural gas, and essential raw commodities such as metals and cereals have risen sharply, putting further pressure on companies and individuals who are already suffering the effects of quickly growing inflation. Worries that the United States would impose an embargo on Russian oil imports have driven crude prices skyrocketing, fueling recession fears.
Mr. O’Reilly said, “Not every recession has been driven by an oil price hike, but every oil price surge has generated a recession.” “This is going to be a long process with a long-term influence on commodities pricing.”
Investors are waiting for statistics on the US trade deficit, which will be released at 8:30 a.m. ET. Consumers spent significantly in January, while inflation drove up prices, according to economists, resulting in another record monthly trade imbalance.
Following Monday’s actions on Wall Street, Asian stock markets plummeted. The Nikkei 225 index in Japan lost 1.7 percent, while the Hang Seng index in Hong Kong sank 1.4 percent to its lowest level since 2016.
Since Russia’s invasion of Ukraine at the end of February, the United States and its allies have slapped harsh sanctions on the country. Shelby Holliday of the Wall Street Journal examines how the sanctions are hurting everyone from President Vladimir Putin to ordinary Russians. Associated Press photo/Pavel Golovkin
Will Horner can be reached at [email protected]
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The “stocks” is the Dow Jones Industrial Average. The index has entered a correction, which means that it’s lost 10% or more of its value in a short amount of time. This was followed by an increase in oil prices and stock futures.
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