[New York Stock Market] "No Surprise" Despite Hawkish Fed, Market Relieved... Mixed Trends Around Steady Range

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[Asia Economy New York=Special Correspondent Joselgina] Major indices on the U.S. New York stock market closed mixed and near flat on the 16th (local time) amid concerns over a potential invasion of Ukraine and tightening messages from the central bank, the Federal Reserve (Fed).

The S&P 500 index, centered on large-cap stocks, showed a decline during the day due to geopolitical tensions surrounding Ukraine but narrowed its losses and turned upward immediately after the release of the January Federal Open Market Committee (FOMC) minutes. Despite the 'hawkish' messages confirmed in the minutes, analysts noted there was no unexpected 'surprise' for the market.

On the day, the Dow Jones Industrial Average closed at 34,934.27, down 54.57 points (0.16%) from the previous day. The tech-heavy Nasdaq index ended the session at 14,124.09, down 15.66 points (0.11%). The S&P 500 index rose 3.94 points (0.09%) to 4,475.01. The small-cap focused Russell 2000 index closed up 55.67 points (2.76%) at 2,076.46.

Investors closely watched the geopolitical tensions surrounding Russia and Ukraine, as well as the January FOMC minutes released in the afternoon.

According to the minutes, most participants mentioned that "if inflation does not decrease as expected, it would be appropriate to remove policy accommodation at a faster pace than currently anticipated." The reduction of the balance sheet is also expected to begin earlier than initially forecasted. Among attendees, many agreed that "the Fed currently holds too many assets" and that "a substantial reduction is appropriate."

However, this direction did not deviate from market expectations. Charlie Ripley, Senior Investment Strategist at Allianz Investment Management, evaluated, "The Fed did not indicate it would be more aggressive than the market had already priced in." Economic media outlet CNBC also reported that "there was no additional surprise."

By individual stocks, VIACOMCBS recorded the largest drop in the S&P 500. After announcing a rebranding to Paramount Global to focus on streaming, its stock slid more than 17%. The release of below-expectation quarterly earnings also contributed to the downside. Meta Platforms, which operates Facebook, closed down more than 2% after unveiling a new slogan.

Leading energy stocks such as Devon Energy (4.73%) and Schlumberger (3.99%) surged sharply. Major tech stocks showed mixed performances: Tesla (0.10%), Nvidia (0.06%), Amazon.com (1.02%), Apple (-0.14%), and Microsoft (-0.12%).

The market also continued to monitor the latest updates on concerns over a potential invasion of Ukraine. Although Russia announced the withdrawal of some troops from the border area with Ukraine the previous day, Western countries including the U.S. remain cautious, stating that no substantial troop withdrawal has been observed.

U.S. Secretary of State Antony Blinken said in an interview with MSNBC on the day, "We have not seen any troop withdrawal." This aligns with remarks made by U.S. President Joe Biden in his national address the previous day. Secretary Blinken asserted that Russia's main forces are not moving away from the border but rather toward it, stating, "What we are seeing is exactly the opposite."

Jens Stoltenberg, Secretary General of the North Atlantic Treaty Organization (NATO), also said on the day, "So far, we have seen no signs of de-escalation on the ground," adding, "There is no withdrawal of troops or equipment."

In the bond market, the yield on the U.S. 10-year Treasury note fell slightly from the previous day but remained in the 2% range. The Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as Wall Street's 'fear gauge,' dropped more than 5% to the 24 range.

New York crude oil prices rose amid ongoing geopolitical uncertainty surrounding Ukraine. On the New York Mercantile Exchange, March West Texas Intermediate (WTI) crude oil closed at $93.66 per barrel, up $1.59 (1.7%) from the previous session.

Although U.S. crude oil inventories unexpectedly increased, concerns over supply-demand imbalances persisted. According to the U.S. Energy Information Administration (EIA), crude oil inventories for the week ending on the 11th rose by 1.121 million barrels to 411.508 million barrels, contrary to market expectations of a decrease.

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