Wall Street is back on the recovery path.
(Photo: Reuters)
new York Investors are stocking up on US stocks hoping for results in Ukraine ceasefire negotiations. The US standard value index Dow Jones closed Tuesday one percent higher at 35,294 points. The tech-heavy Nasdaq advanced 1.8 percent to 14,619 points. The broad S&P 500 gained 1.2 percent to 4631 points.
According to the negotiators, Ukraine offered Russia neutrality in exchange for security guarantees. Russia’s chief negotiator Vladimir Medinsky described the meeting as constructive. The Russian Defense Ministry also announced that it would reduce military activities around Kyiv and Chernihiv in order to provide a framework for the talks. Sam Stovall, chief investment strategist at research house CFRA, says this is fueling hopes that the two warring factions will soon reach an agreement.
This dampened fears of Russian energy supply failures. As a result, the price of US crude oil WTI fell by almost one percent to $104.99 per barrel (159 liters). Naeem Aslam, chief market analyst at AvaTrade brokerage firm, said the likelihood of further sanctions against Russia decreases if hostilities end. Investors also withdrew from “safe havens”. Gold fell 0.2 percent to $1,919 an ounce (31.1 grams).
The futures contract for ten-year US government bonds (T-Note future) rose on Tuesday after initial price losses. It recently rose by 0.45 percent to 122.27 points. The yield on 10-year Treasuries also fell to 2.40 percent after rising to its highest level since May 2019 at 2.55 percent the previous day.
Top jobs of the day
Find the best jobs now and
be notified by email.
In addition, for the first time since 2019, the yield on two-year bonds on the bond market exceeded that of ten-year bonds at 2.48 percent. This reinforces the market’s view that interest rate hikes by the US Federal Reserve could possibly cause a recession. The yield ratio reversal occurred as two-year yields rose while 10-year yields fell, crossing at about 2.39 percent.
For short-term returns to be higher than long-term returns is an abnormal occurrence. It signals that high levels of short-term yields are unlikely to be sustained as growth slows. The reversal in 2-10 year bonds is the latest in a series that began in October when 20-year bond yields outperformed 30-year bonds.
Look at the individual values
armaments companies: Lockheed Martin, Raytheon and Northrop Grumman are down as much as 1.76 percent. They had risen sharply due to the planned rearmament of Western countries in response to the Russian invasion of Ukraine at the end of February.
bird: Bird’s shares are up 4.6 percent. The company reportedly got the green light to double the number of its scooters in New York City. In the US capital Washington, the fleet is to be increased by more than 20 percent.
Nielsen Holdings: Nielsen Holdings shares are up about 20 percent. The company previously agreed to be acquired by a private equity consortium for $28 per share. The deal is valued at $16 billion, including assumed debt.
Fedex: After almost 50 years, company founder Fred Smith is stepping down as head of the parcel delivery company. Director Raj Subramaniam, who has been responsible for operational business up to now, will take over his job. Fedex shares are up 3.7 percent and rival UPS is up 1.5 percent.
About: As the New York Times reports, Uber is close to an agreement with a San Francisco taxi company to include its taxis on its platform. Uber recently made a similar agreement in New York. The share increases by about 6.96 percent.
Airlines: Hopes of an imminent ceasefire in Ukraine are encouraging investors to invest in US airlines. American Airlines, Delta and United shares are up as much as 4.9 percent. The titles had previously been lost due to Western sanctions against Russia in response to Russia’s invasion of Ukraine at the end of February.
Dave & Buster’s: The share rose by 14.9 percent. In the last quarter, Dave & Buster’s posted a deficit in both sales and earnings.
More: “Gray swans”: Investors should pay attention to these five risks