The stock market was lower Wednesday as markets digest Tuesday’s big rally. New sanctions from the U.S. on Russian lawmakers haven’t exactly helped.
Dow Jones Industrial Average
futures had fallen 118 points, or 0.3%, while
The market’s dip comes after stocks rallied on Tuesday, bringing the major indexes to impressive gains from their recent lows. The S&P 500, heading into the open on Wednesday, is up just over 8% from its March 8 closing low of the year. The buying has come even as the Federal Reserve has made clear it will lift interest rates many times in the next couple of years to fight inflation, a move that would drag economic growth lower, perhaps into recession.
“The big question now is whether all this prospective Fed tightening will push the economy into recession or whether policymakers can achieve the much sought-after “soft landing” that avoids one,” writes Deutsche Bank strategist Jim Reid.
Tuesday evening, news broke that the White House is preparing sanctions on members of Russia’s lower house of parliament, Duma. This comes as fighting in Ukraine continues. President Joe Biden and NATO allies are expected to announce additional sanctions on Russia when they meet in Brussels this week.
The pressing fear is further sanctions on Russian commodities, which would restrict the global supply and lift prices, creating even more burdensome inflation for consumers to deal with. The Bloomberg Commodity Index is up 29% for the year, though it’s down from its March 8 peak, a welcomed site for stock investors.
For now, at least, investors seem willing to look past the war, rising commodity prices and Wednesday’s decline notwithstanding. “The war has had significant impacts on commodity prices, inflation expectations, and certain stock market sectors,” writes Yardeni Research’s Ed Yardeni. “Investors know that geopolitical crises can present buying opportunities.”
Here are some stocks on the move Wednesday:
(GME) had gained 8.8% Wednesday to $135.89 after Chairman Ryan Cohen snapped up 100,000 more shares in the meme stock, taking his holding up to 11.9%.
(ADBE) had fallen 3.3% to $451 after the software company reported better-than-expected earnings but provided an outlook for the current quarter that fell short of Wall Street estimates.
(TMUS) stock gained 0.4% after getting upgraded to Overweight from Sector Weight at KeyBanc Capital Markets.
(BP) stock rose 2.8% after getting upgraded to Overweight from Equal Weight at Morgan Stanley.
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