Wall Street starts in the red. JPMorgan warns of ‘indirect exposure’ to Ukraine crisis
This Tuesday, Wall Street reopened in negative territory – after being closed yesterday, marking George Washington’s birthday holiday – as investors digested Vladimir Putin’s signing of the Declaration of Independence of Ukraine’s breakaway regions and the negative consequences. Sanctions were imposed on Russia for this act.
The Dow Jones Industrial Average opened to lose 0.84% to 33,366.27 points. The Standard & Poor’s 500 Index fell 0.61% to 4,316.4 points. On the other hand, the Nasdaq Technology Index fell 0.81% to settle at 13,431.14 points.
On a day drawn in red, technical services (-19.77%), consumer durables (-18.74%) and retail (-14.6%) were the sectors that lost the most. Energy, non-durable consumer goods, health and communications were the only ones starting in the green.
FedEx Corp (6.10%), Occidental Petroleum (5.56%) and Dollar General (5.02%) were the main winners at the start of the session. On the loss side, PPL Corp – (-7.25%), General Electric (-5.86%) and Celanese Corp (-5.68%) top the board on Wall Street.
In addition to Vladimir Putin’s comments on the breakaway regions of Ukraine, the words of US Federal Reserve Governor Michael Bowman, who on Monday supported an increase in interest rates, continue to weigh on investor sentiment. “50 basis points,” according to Bloomberg.
Although US companies have little direct exposure to the Russian market, analysts fear that US companies will suffer a slowdown in growth, due to indirect exposure, caused by higher food and energy prices, which will tend to rise with escalating tensions between Ukraine and Russia.
“Geopolitical tensions between Ukraine and Russia carry low geopolitical risks for the US market, but the rise in energy and food prices caused by this crisis may slow the growth of some companies,” warns a note from “research” by JPMorgan, published today and compiled by Bloomberg. McDonald’s, PepsiCo, American Airlines, Boeing and ExxonMobil may be hardest hit.
“The market has reason to be concerned about the conflict in eastern Ukraine, as this event could exacerbate the inflation scenario we are seeing that was expected to slow in the second half of this year,” RBC Markets warned in research. note “.” Also released today.
For analysts, “any good news, no matter how small, on this matter is likely to sharply increase risk appetite and lift stocks.”
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