[New York Stock Market] Nasdaq Up 2.53% as Ukraine Fear Eases... 10-Year Bond Yield Surpasses 2% Again

[Image source=Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Major indices on the U.S. New York Stock Exchange rose collectively on the 15th (local time) as concerns that Russia might invade Ukraine at any moment eased. With geopolitical risks subsiding, the price of West Texas Intermediate (WTI) crude oil, which had surged recently, fell by nearly 4%, and the U.S. 10-year Treasury yield surpassed 2% again.

On the New York Stock Exchange that day, the Dow Jones Industrial Average closed at 34,988.84, up 422.67 points (1.22%) from the previous day. The large-cap focused S&P 500 index rose 1.58% to 4,471.07, and the tech-heavy Nasdaq index closed 2.53% higher at 14,139.76.

The market showed signs of revived investor sentiment as Russia announced it would withdraw some troops deployed near the Ukraine border. Igor Konashenkov, spokesperson for the Russian Ministry of Defense, stated in a press release that units from the Southern and Western Military Districts that had completed their missions would finish their training and begin returning to their original garrisons.

This news came just one day before the 16th, which the U.S. had designated as the 'D-Day' for a potential Russian invasion. Although the exact troop numbers and locations were not disclosed, the invasion fears that had recently put global financial markets on edge were significantly alleviated. Russian President Vladimir Putin’s remarks after his meeting with German Chancellor Olaf Scholz, saying "Do we want war? Of course not," also had a positive effect on the market.

By sector, airline and cruise stocks led the gains. American Airlines rose 7%, and Carnival climbed over 6%. Technology stocks were also strong. Tesla closed up 5.33%, reclaiming the 900-dollar mark. Apple rose 2.32%, and Nvidia jumped 9.18%. Meta Platforms (1.52%), Microsoft (1.85%), and Netflix (2.75%) also showed upward momentum. Rivian’s shares surged nearly 6% following investment news from hedge fund legend George Soros. However, energy companies continued their decline from the previous day. ExxonMobil slipped 2%, and ConocoPhillips fell 3%.

With tensions around Ukraine easing, international oil prices, which had been approaching 100 dollars per barrel, declined. On the New York Mercantile Exchange, March WTI prices closed at 92.07 dollars per barrel, down 3.39 dollars (3.6%) from the previous session. In the bond market, Treasury prices fell, pushing yields higher. The U.S. 10-year Treasury yield rose to around 2.05%, the highest level since July 2019. Bitcoin also showed an upward trend.

Lian Detrick, an analyst at LPL Financial, told CNBC, "The easing of tensions between Russia and Ukraine is helping overall sentiment today."

Besides the Ukraine situation, the market also focused on inflation indicators, as they could influence the Federal Reserve’s future tightening moves.

The U.S. Producer Price Index (PPI) for January, released that morning, rose 1.0% from the previous month and 9.7% year-over-year, far exceeding market expectations. The core PPI, which excludes volatile food and energy prices, increased 0.8% month-over-month, the largest rise since January 2021. Core PPI was also up 6.9% compared to a year ago.

Bloomberg News analyzed that "this suggests inflationary pressures may persist." Market consensus strongly anticipates the Fed will raise interest rates in March, with the possibility of a big step increase of 0.5 percentage points. The Fed will release the minutes of its meeting on the 16th.

However, regarding the Ukraine situation, the U.S. and other Western countries remain cautious. U.S. President Joe Biden, in a speech at the White House 30 minutes before market close that day, stated, "We have not yet confirmed that Russian troops are returning to their headquarters. They remain in threatening positions," and added, "The threat of a Russian invasion of Ukraine remains high."

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