Stocks were mixed Friday as investors mulled upbeat remarks from Russian President Vladimir Putin about diplomatic discussions with Ukraine. A weaker-than-expected print on U.S. consumer sentiment.
Before markets opened, Russian President Vladimir Putin said that there were some “positive shifts” in talks between the countries two weeks into Moscow’s military campaign in Ukraine, adding that negotiations are “now being held on an almost daily basis.”
The Dow Jones Industrial Average was up 339 points, or 1%, at 33,513, as of 9:50 a.m. Eastern time, and the Nasdaq composite was 0.5% higher. They all remain down for the week, even though the S&P 500 surged in the middle of it to its best day since the summer of 2020.
The Nasdaq dipped into the red, while the Dow held higher. The S&P 500 fluctuated between small gains and losses. Though all three indexes opened in the green, stocks pared some earlier gains mid-morning after a new report showed U.S. consumer sentiment deteriorated more than expected in early March as consumers’ inflation expectations soared to the highest since 1981.
European stocks and US stock futures made abrupt moves upward early Friday before Wall Street trading opened. Some analysts pointed to comments from Russian President Vladimir Putin seen as surprisingly optimistic. Putin cited “certain positive developments” in negotiations with Ukraine, though he didn’t offer any details.
Markets were already on edge before Russia’s invasion, as central banks around the world move to raise interest rates and remove support for the economy put in place after the pandemic. The Federal Reserve and other central banks hope to stamp out the highest inflation in generations. Though they also risk causing a recession if they raise rates too high or too quickly.
Inflation has surged high enough that politicians around the world know they may be in trouble because of it.
Wall Street heads for the exit
Big U.S. banks had pulled back from Russia after 2014. The only major U.S. bank that kept a significant presence is Citigroup, which has about 3,000 employees there and previously said it had nearly $10 billion in exposure to Russia. Citi said on Wednesday that it would “assess our operations in the country”; it had put its consumer division in Russia up for sale last year.
Goldman’s presence in Russia is small in relation to the $1.5 trillion bank’s global operations: Its total credit exposure was $650 million at the end of 2021. The bank has about 80 employees in Russia and is arranging for the departures of those who have asked to leave. (Some have already moved to Dubai.
JPMorgan said it was “unwinding Russian business” and wouldn’t pursue new ventures there. The bank holds assets for some clients in the country. It has more than 100 workers there, but the business was not big enough to rank among its top 20 markets.
Earning Reports
Tesla (TSLA) rival Rivian (RIVN) reported weaker-than-expected fourth-quarter earnings results. The EV pickup maker reported a big loss and slim revenue while warning that supply-chain woes will “persist.”
RIVN stock sold off hard overnight after skidding to a record low in Thursday’s session. As for Tesla stock, shares fell from key resistance and back below their 200-day line.
Oracle (ORCL) missed earnings views, while the software giant’s revenue was in line. Oracle stock fell slightly early Friday.
DocuSign (DOCU) met on EPS and beat on sales, but its fiscal 2023 revenue guidance fell short. But DOCU stock, which crashed 42% after the prior earnings report, plunged in extended trade.
Ulta Beauty (ULTA) beat views and announced a new $2 billion ULTA stock buyback. ULTA stock rose slightly in overnight action, near an early entry after retaking the 50-day line Thursday and closing on a trendline.
Meanwhile, Costco Wholesale (COST), Regeneron Pharmaceuticals (REGN), and J.B. Hunt Transport Services (JBHT) are rebounding from key levels and not far from possible buy points.
Other News
Crude oil prices edged higher after tumbling on Thursday when U.S. West Texas intermediate slid back below $110 per barrel after topping as much as $130 a barrel in recent sessions. Still, gas prices at the pump rose to fresh highs.
In the US, a report on Thursday showed prices at the consumer level leaped 7.9% last month from the prior year, the hottest inflation rate since 1982. It’s likely to get worse in the near term due to oil’s surge following the war and all the financial penalties the US and allies imposed on Russia.
Morgan Stanley and Google-parent Alphabet Inc added 2% and 1.3%, respectively, in premarket trading to lead gains among big banks and mega-cap growth companies. Energy shares fell, with Chevron Corp and Exxon Mobil down 2.5% and 0.9%, respectively.
The S&P 500 energy sector has risen in nine out of the past 10 sessions and has gained 38.5% year-to-date on soaring crude prices. Oil scaled as much as $139 a barrel earlier this week on supply fears due to Western sanctions on Russian oil and oil products.
