Stocks waver as traders eye rate hikes, Ukraine

BSS

08 Feb 2022, 10:04

Stocks waver as traders eye rate hikes, Ukraine

NEW YORK, Feb 8, 2022 (BSS/AFP) - Global stocks were mixed Monday while oil
prices dipped as markets mull over expected interest rate hikes and Ukraine
tensions.

While US stocks flirted with positive territory, two of the three major
indices ended up lower as markets await critical US consumer price data later
in the week that will help determine how aggressively the Federal Reserve
responds to inflation.

Earlier, European indices rebounded from Friday's losses, while Asian
bourses were mixed.

"Stocks remain under pressure," said a note from US Bank Wealth
Management's Terry Sandven. "Near-term, equity price stabilization is
unlikely to occur until certainty around the timing and magnitude of Federal
Reserve interest rate increases become better known."

A forecast-busting US jobs report Friday reinforced optimism that the
world's top economy was well on the recovery track, but also ramped up
expectations of an interest rate hike by the US Federal Reserve in March.

It comes as surging global inflation resulted in the Bank of England last
week hiking its main interest rate for the second meeting in a row, while the
European Central Bank signaled for the first time that it may raise borrowing
costs this year.

"Volatility is likely to remain as the global markets adjust to the
prospect of tighter monetary policies, as well as geopolitical tensions
between Russia and Ukraine, and a mixed (fourth quarter) earnings season,
which will continue to roll on this week," investment bank Charles Schwab
said in a note.

On the geopolitical front, investors are nervous over Western fears that
Russia plans to invade Ukraine.

French President Emmanuel Macron met with Russian leader Vladimir Putin in
Moscow, while US President Joe Biden met with Germany's Chancellor Olaf
Scholz on the impasse in Eastern Europe.

Traders are also watching for more corporate earnings statements this week
after a disappointing report from Facebook parent Meta last week caused the
company's shares to sink.

This week's earnings calendar includes results from Pfizer, Disney and
Coca-Cola.

Elsewhere Monday, oil prices continued their retreat after European
benchmark contract, Brent North Sea crude, hit $94 a barrel -- the highest
level for more than seven years.

"Oil prices are a little flat at the start of the week with the rally
losing a little momentum after nuclear talks between the US and Iran appeared
to make positive progress," Erlam said.

But the continued reopening of the world economy as well as a cold snap in
the United States and uncertainty over the Russia-Ukraine standoff are
expected to keep crude futures well supported, according to analysts.

- Key figures around 2140 GMT -

New York - Dow: FLAT at 35,091.13 (close)

New York - S&P 500: DOWN 0.4 percent at 4,483.87 (close)

New York - Nasdaq: DOWN 0.6 percent at 14,015.67 (close)

London - FTSE 100: UP 0.8 percent at 7,573.47 (close)

Frankfurt - DAX: UP 0.7 percent at 15,206.64 (close)

Paris - CAC 40: UP 0.8 percent at 7,009.25 (close)

EURO STOXX 50: UP 0.8 percent at 4,120.56 (close)

Tokyo - Nikkei 225: DOWN 0.7 percent at 27,248.87 (close)

Hong Kong - Hang Seng Index: FLAT at 24,579.55 (close)

Shanghai - Composite: UP 2.0 percent at 3,429.58 (close)

Euro/dollar: DOWN at $1.1440 from $1.1449 Friday