Futures and oil drop during talks between the United States and Europe

0
  • Futures and oil prices fell on Friday as investors weighed the impact of talks between the United States and Europe.
  • European countries refrained from sanctioning imports of Russian crude, easing upward pressure on the oil market.
  • The S&P 500 was on track for its second week of gains, but still remained around 5% lower for the year.

Stock futures fell on Friday after stock markets rose broadly the day before, while oil prices fell as investors weighed the impact of energy talks between the United States and the United States. European Union.

S&P 500 futures were down 0.11%, Dow Jones futures were down 0.09% and Nasdaq 100 futures were down 0.17%.

In Europe, the continent-wide Stoxx 600 was down 0.09% in early trading. Asian stocks fell overnight, with China’s CSI 300 ending down 1.81% as investors worried about possible US sanctions on the country’s companies if Beijing steps up support for Moscow and its war on Ukraine.

Oil prices cooled, with Brent down 2.09% to $116.54 a barrel and WTI down 2.31% to $109.93 a barrel.

The price drop came after European Union leaders dropped their boycott of Russian oil as they met for high-level talks in Brussels. Austria, which gets around 70% of its natural gas from Russia, is among countries warning that such sanctions would hurt the wider European economy.

However, the EU and the United States are expected to announce an agreement allowing the United States to supply more liquefied natural gas to the trading bloc, after President Joe Biden met with the leaders in the Belgian capital on Thursday.

Investors have been scrambling to understand the economic implications of Russia’s invasion of Ukraine, which began Feb. 24.

Russia’s status as a major energy supplier and harsh Western sanctions imposed on the country have driven up energy prices, raising fears that inflation will rise even further and central banks will be forced to quickly tighten their monetary policy.

“In the short term, we believe the results for the markets will focus primarily on when we will reach – or have already reached – the peak of sanctions and oil prices,” said Mark Haefele, director of investments at UBS Global Wealth Management. , in the firm’s monthly newsletter.

US stocks were already having a tough year on expectations that the Fed would raise interest rates sharply in 2022, before the war in Ukraine injected more


volatility

.

Still, over the past two weeks, the S&P 500 has staged something of a comeback and was set for another week of gains on Friday. The index remained around 5% lower for the year at Thursday’s close, while the Nasdaq 100 was down 9.5% and the Dow Jones was down 4.5%.

Bond prices fell as central banks began to raise interest rates and reduce support for fixed income markets.

The yield on the 10-year Treasury note, which moves inversely to price, fell 2.1 basis points on Friday to 2.354%. It was still trading near three-year highs, having started the year around 1.6%.

Investors were pricing in mixed economic data on Thursday that showed weekly U.S. jobless claims fell to their lowest level since 1969 last week, but new durable goods orders fell 2.2% in February.

“Trading activity may slow down a bit more, but few expect the space to completely deteriorate,” said Edward Moya, senior market strategist at Oanda.

Read more: The founder of a $100m space investment fund explains why the war in Ukraine is transforming the sector – and shares 9 stocks that could skyrocket as the conflict continues

Share.

Comments are closed.