Investors had no reason to redeem the stock market for the weekend, so the main US stock indices ended the trading session in the negative. The Russian-Ukrainian “relationship” continues to hang over the financial markets.
The Dow Jones lost 0.69%, falling for the fifth week in a row. The S&P500 and Nasdaq broad market indices were down 1.3% and 2.18%, respectively. The DJI was stronger than other benchmarks with McDonalds (MCD) +2.25%, Caterpillar (CAT) +1.43% and Travelers (TRV) +1.07%.
Crude oil slightly corrected for the drop. West Texas Intermediate (WTI) futures rose 2.9% to $109 a barrel. European benchmark Brent managed to reach $112 per barrel, gaining 2.55%.
On the background of the tense geopolitical situation and the special operation of the RF Armed Forces on the territory of Ukraine, the stock markets make attempts to find positive in Putin’s words about “certain positive shifts” in the negotiation process, and in Zelensky’s words about the readiness for neutral status, and to discuss both the Crimean issue, and the situation around the DNR and LNR.
But in fact, they will be forced to sit idly by while waiting for the actual demilitarization and denazification of the Mariupol agglomeration, as well as the Ukrainian capital.
According to the Russian Defense Ministry, Mariupol is already blockaded, with the Ukrainian capital on the way. When the active phase starts in the cities themselves, US and European TV channels will flood the entire Western media space with hysteria. We can’t hope for objective coverage of the events, so it’s very likely that the stock market will still have a chance to be below current levels.
Kommersant reports that the Central Bank is ready to gradually revive the Russian financial markets and is ready to start with discrete bond auctions next week. Later the same scheme is expected to be applied to stocks. When the situation stabilizes, the Russian stock markets will switch to a regular trading format.
