[New York Stock Market] US Inflation and Ukraine Negotiation Breakdown Lead to Decline... Nasdaq Down 0.95%

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Following Russia's invasion of Ukraine, the first high-level talks ended without any progress, and with U.S. inflation nearing 8%, major indices on the New York Stock Exchange showed a downward trend on the 10th (local time).

On this day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 33,174.07, down 112.18 points (0.34%) from the previous session. The S&P 500, focused on large-cap stocks, fell 18.36 points (0.43%) to 4,259.52, while the tech-heavy Nasdaq dropped 128.58 points (0.95%) to close at 13,129.96. The small-cap Russell 2000 also declined 4.62 points (0.23%) to 2,011.67.

Investors paid close attention to the U.S. consumer price index data released that day, rising oil prices, and the high-level negotiations between Russia and Ukraine. The foreign ministers of Russia and Ukraine met in Turkey for talks but ended the meeting without any breakthroughs, leading to market disappointment. Mike Musio, president of FBB Capital Partners, described the mood as "investors are oscillating between hope and fear."

By sector, energy stocks, which had been weak the previous day, rose despite the decline in oil prices. Chevron closed up 2.74%, and ExxonMobil rose 3.10% from the previous session.

Technology stocks showed weakness. Tesla closed down 2.65%. Microsoft (-0.96%), Apple (-2.93%), Meta Platforms (-1.45%), and Nvidia (-1.36%) all slipped.

Amazon's stock jumped 6% following news of a 20-for-1 stock split and a $10 billion share repurchase program. The market sees an increased possibility of Amazon being included in the Dow Jones index due to the stock split. CrowdStrike surged 12.5% after raising its earnings outlook.

Goldman Sachs, the first on Wall Street to announce its withdrawal from Russian operations, closed down 1.1%. JP Morgan, which announced a similar policy in the afternoon, also fell more than 1%.

Amid growing inflation concerns, the U.S. 10-year Treasury yield briefly surpassed 2% during the session, the first time since February 25.

The U.S. Consumer Price Index (CPI) for February, released that day, surged 7.9% year-over-year, marking the largest increase since January 1982. This exceeded the market expectation of 7.8% and was higher than the previous month's 7.5%, which was the largest increase since February 1982.

The core CPI, excluding the volatile energy and food sectors, soared 6.4% year-over-year. Immediately after the data release, U.S. President Joe Biden issued a statement attributing the inflation to "gas and energy price increases caused by Vladimir Putin's aggressive actions," directly blaming President Putin. Since Russia's invasion of Ukraine last month, gas and energy prices have surged, reflected in these figures.

However, considering that Russia's invasion began at the end of February, the impact of soaring oil and commodity prices is expected to be more fully reflected in data from March onward. Accordingly, the market is raising the possibility that U.S. inflation, initially expected to peak in February, may worsen further.

John Leer, chief economist at Morning Consult, said, "The inflation situation is worsening," and expressed concern that "unfortunately, the war in Ukraine will make it even harder to control prices." The U.S. Federal Reserve is expected to officially announce a rate hike at next week's FOMC meeting. Ed Keon, chief investment strategist at PGIM, said, "The Fed faces a very difficult challenge," adding, "It will have to walk a tightrope between inflation and recession."

International oil prices initially rose more than 5% but ended lower after volatility. On the New York Mercantile Exchange, April West Texas Intermediate (WTI) crude oil closed at $106.02 per barrel, down $2.68 (2.5%) from the previous session. This closing price was the lowest since March 1.

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