- More from Fed's Bostic - Fed needs to move off its emergency policy settings
- Dow & NASDAQ close lower for the 4th consecutive day. S&P lower for the 3rd day.
- Fed's Bostic says firms are being constrained by tight labour market
- US official: Prepared w/a large number of countries to implement export control measures
- Biden: Putin is setting up a rational to go much deeper into Ukraine. This is an invasion
- The US treasury sells $52B of 2 year notes at 1.553% vs WI 1.559%
- Troops are on the move...
- White House: Export controls to hit Russian companies
- European major indices are ending the session mixed. UK's FTSE 100 up marginally
- Putin says Russia recognized expanded versions of breakaway republics
- Putin: The Minsk peace deal concerning Ukraine was killed off by Ukrainian authorities
- Russia's upper house vote in favor of giving Putin authority to deploy troops
- Russia's Kosachyov: Parliamentary approval will allow Putin to bring peace to SE Ukraine
- Richmond Fed composite index for February 1 vs 8 previously (estimate 10)
- US February consumer confidence index 110.5 vs 110.0 expected
- Markit Feb flash US services PMI 56.7 vs 53.0 expected
- Russia foreign min: Boundaries of Donetsk and Luhansk to be resolved in the future
- Case-Shiller US December 20-city house price index +18.6% y/y vs +18.2% expected
- China advises lockdown as Hong Kong covid cases hit 8000 today
- Russia's Medvedev on Nord Stream 2 suspension: Welcome to new world of 2000-euro gas
- The NZD is the strongest and the CHF is the weakest as NA session begins
- UK PM Johnson: Sanctioning 5 Russian banks, and three individuals from travelling to UK
- ForexLive European FX news wrap: Risk recovers, sanctions on Russia meagre
The Russian Parliament rubber stamped Russian President Putin's request to deploy troops and invade SE Ukraine. Putin frames it as a way to protect and come to the aid of the Russian separatists in Bonestsk and Luhansk after declaring them independent, but NATO sees it as an invasion of at least part of a nation (and who knows where it might end).
The actions by Putin/Parliament led to Pres. Biden to announce the start of US sanctions against two Russian banks, on elites and some high up Russian family members, and on Russian sovereign debt. Including the sovereign debt would cut Russion off from financing from the West. Also Germany said that they reevaluate the NordStream 2 pipeline, and the EU and Britain also imposed similar sanctions including separatist imports and exports.
US Secretary of State announced that he would not be meeting with Russia's Lavrov.
The pressure is on. Let the battle begin.
The news pushed stocks lower with the major US indices showing declines of 2.2% for the Nasdaq, -2.10% for the Dow and -1.88% for the broad S&P. just ahead of the Biden speech.
However, those losses were retraced more than 1/2 of the declines after the speech, only to reverse back lower into the close.
At the end of the day, the:
- Dow closed down -1.42%
- S&P fell -1.01%
- Nasdaq fell -1.23%.
The Dow and Nasdaq have now fallen 4 consecutive days. The S&P is on a 3 day losing streak.
In other markets,
- Gold traded above and below the $1900 level and closed just below that level at $1899
- Crude oil reached as high as $94.95, but did back off to $91.61 near the end of day
- Bitcoin rose to $37988 after trading as low as $36368 at the session lows
In the US debt market, the US yields moved sharply higher on the short end in particular despite a strong 2 year note auction today. The 2 year is up 9 basis points at 1.5615% after trading as low as 1.429% overnight on flight to safety flows. While Russia/Ukraine remains a global issue filled with uncertainty, the Fed''s Bowman hinted that she might be in favor of a 50 basis point hike in March.
Economic data today was mostly supportive of a strong economy as Case Schiller home prices remain elevates, the flash services PMI moved up to 56.7 vs 53.0 expected, and US consumer confidence moved to 110.5 vs 110.0 expected.
In the forex market, the flow of funds were a bit counter to "risk off' expectations on war risk. The NZD and AUD were the strongest of the majors, while safe havens like the CHF, JPY were the weakest.
The USD is ending the session mixed with gains vs the CHF and JPY and losses vs the NZD and AUD. The other currencies vs the greenback are ending the day near unchanged.
