Daily market review

United States

Stocks sank again Thursday as Ukraine worries fueled risk-off sentiment and company news disappointed. The Dow Jones industrial average fell 1.8 percent, the S&P 500 lost 2.1 percent, and the NASDAQ sank 2.9 percent.

Increased shelling along the line between Ukrainian forces and Russian separatists and President Biden's warning that the threat of Russian invasion remained "very high" ratcheted up market concern. Stock losses were nearly across the board with selling accelerating into the close. Defensive plays held up, including consumer staples and utilities. Hawkish rhetoric from St. Louis Fed President James Bullard added to the bearish view as Bullard repeated his call for 100 basis points of rate increases by July 1 and a fast start to drawing down the Fed's balance sheet.

Information technology, health care, and banking stocks were hit hard. Chipmaker Nvidia dropped 7.6 percent despite reporting blowout earnings and revenues as its margin outlook disappointed. Applied Materials fell 3.2 percent on margin pressures due to supply chain problems. Software stocks tanked with Salesforce.com off 5.6 percent and heavyweight Microsoft off 2.9 percent. Palantir Technologies, the data business, dropped 16 percent after an earnings miss. Tesla lost 5.1 percent after a poor rating by Consumer Reports.

Among old economy stocks, Albemarle, the chemicals company, dropped 20 percent on a revenues miss. Hyatt Hotels fell 4.2 percent on a profits miss. Goldman Sachs lost 3.1 percent in the downdraft.

On the positive side, Coca-Cola rose 2 percent and Procter & Gamble gained 1.2 percent as consumer staples perked up. Walmart rose 4 percent after the discount retailer reported strong sales and earnings growth. Some analysts viewed Walmart's results as another sign of consumer strength and endorsement for aggressive Fed rate increases.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil ended at US$93.09, up more than $1 from late Wednesday but down $1 from early Thursday highs. Spot gold rose US$25.88 to US$1,898.31. The US dollar was mixed vs. major currencies. Yields on the US Treasury 30-year bond declined 5 basis points to 2.29 percent, and the 10-year note fell 8 basis points to 1.96 percent.


Equities retreated on risk-off sentiment with the Ukraine crisis in focus. The Europe-wide STOXX 600 and the German DAX both declined 0.7 percent, the French CAC eased 0.3 percent, and the UK FTSE 100 was off 0.9 percent.

Among sectors, basic resources, banks, and financial services lagged while autos & parts and defensives -- including utilities and food & beverage -- held up better.

Among companies in focus, Continental, the auto parts leader, rose 3.0 percent on a report it may split into separate business units. Kering, the luxury goods conglomerate, rose 5.0 percent and Commerzbank advanced 2.2 percent on earnings beats.

On the downside, Air France fell 7.6 percent despite better results after announcing a share offering. Infineon, the chipmaker, lost 2.6 percent on an analyst downgrade.

Asia Pacific

Asia/Pacific markets were mixed with initial gains evaporating on Ukraine worries.

Japan's markets weakened after Russian media reported Ukrainian forces fired on rebel-held territory in the east, a report Ukraine later denied. The Nikkei 225 and the wider TOPIX index both declined 0.8 percent. Among sectors, weakness centered in services, communications, and warehousing stocks.

China's CSI 300 index rose 0.2 percent and the value-stock heavy Shanghai composite firmed 0.1 percent. Among sectors, industrials and materials outperformed while telecom services and real estate lagged. Hong Kong's Hang Seng index gained 0.3 percent with support from reopening stocks, offset by weakness in real estate.

The Taiwan Taiex rose 0.2 percent and the South Korean KOSPI rose 0.5 percent with technology stocks better. Indian equities weakened with the BSE Sensex down 0.2 percent as bank and utilities stocks declined.

Positive earnings news offset negative Ukraine news to leave the Australian All Ordinaries index unchanged. Most sectors improved, paced by health care, materials, and financials, industrials, and energy. Consumer discretionary, tech, and telecom lagged. Among companies in focus, Wesfarmers, the retailer, fell 7.5 percent on fallout from pandemic effects.

Looking ahead*

In Asia/Pacific, New Zealand PPI and Japanese CPI reports are scheduled. In Europe, French ILO unemployment, UK retail sales, French CPI, and Eurozone EC consumer confidence reports are due. In North America, US existing home sales and US leading indicators reports are on tap.

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