[New York Stock Market] Fed Tightening and Ukraine Fear... Closing Down Across the Board

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[Asia Economy New York=Special Correspondent Joselgina] On the 14th (local time), major indices on the New York Stock Exchange all closed lower amid the Federal Reserve's (Fed) tightening stance and rising concerns over Russia's invasion of Ukraine. As geopolitical risks became prominent, crude oil prices surpassed $95 per barrel during the session, hitting the highest level since September 2014.

On this day, the Dow Jones Industrial Average closed at 34,566.17, down 171.89 points (0.49%) from the previous session. The S&P 500 index fell 16.97 points (0.38%) to 4,401.67, and the Nasdaq index closed at 13,790.92, down 0.23 points (0.0%). The Russell 2000 index, which focuses on small-cap stocks, also slipped 0.46% from the previous session.

Investors closely monitored remarks from Fed officials and geopolitical risks surrounding Ukraine. James Bullard, President of the St. Louis Federal Reserve Bank, who appeared on CNBC in the morning, once again called for aggressive interest rate hikes by the Fed. This was seen as spreading concerns about Fed tightening and weakening investor sentiment. The escalating geopolitical tensions between Russia and Ukraine also froze the market.

In particular, the energy sector, led by ExxonMobil, drove the market's decline amid fears of an imminent invasion of Ukraine. The S&P 500 energy sector fell more than 2%, moving opposite to the rising oil prices. Marathon Oil dropped 4.50%, Occidental Petroleum fell 4.07%. Diamondback Energy (-3.76%), ExxonMobil (-1.53%), and ConocoPhillips (-2.11%) also closed lower.

Technology stocks, which are closely watched amid the Fed's tightening stance, showed weakness in some stocks but reduced losses as the market closed. Meta Platforms, which had fallen more than 2% during the session, closed 0.84% lower than the previous session. Apple (0.14%) turned to an upward trend, and Microsoft (-0.01%) recovered some losses. Tesla (1.83%), Nvidia (1.33%), and Amazon.com (1.22%) closed higher.

Geopolitical tensions between Russia and Ukraine remain unresolved. Over the weekend, U.S. President Joe Biden and Russian President Vladimir Putin held a phone call but failed to find a breakthrough. The U.S. State Department announced the closure of its embassy in Kyiv, the capital of Ukraine, and its relocation to Lviv, a western city near the Polish border.

David Snowden, a technical analyst at Credit Suisse, explained, "The global stock market outlook remains weak," adding, "The market is under pressure due to rising global government bond yields, expectations of interest rate hikes, and added geopolitical risks."

Michael Wilson, a Morgan Stanley strategist, diagnosed in an investor letter, "Considering technical indicators, we are still in a bear market." He also added that the three major indices could return to their January lows.

The Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as Wall Street's 'fear index,' surged to the 32 level during the session before falling back to around 28, but this was still 3.55% higher than the previous session. In the New York bond market, the yield on the U.S. 10-year Treasury note rose slightly to around 1.99% compared to the previous session.

As geopolitical tensions escalated, international oil prices rose. On the New York Mercantile Exchange in the afternoon, March delivery West Texas Intermediate (WTI) crude oil prices rose 2.06% ($1.92) to $95.02 per barrel compared to the previous session. During the session, prices briefly reached $95.82 per barrel before settling around $95. This is the first time WTI has surpassed $95 per barrel since September 2014. April delivery Brent crude on the London ICE Futures Exchange also traded around $96 per barrel, marking the highest level since 2014.

Nishant Bhushan, market analyst at global energy research firm Rystad Energy, said, "Russia is one of the world's largest crude oil producers," adding, "If crude oil supply from Russia is cut off, WTI and Brent prices could soar above $100 per barrel."

The price of gold, a representative safe-haven asset, also rose. On the New York Commodity Exchange (COMEX), April delivery gold rose $31.60 per ounce to $1,873.70 compared to the previous session.

This content was produced with the assistance of AI translation services.