Wall Street comforted by today’s drop in commodity prices: WTI and Brent accelerate to the downside, suffering a thud above -5% and slipping to approximately $ 117 and $ 121 dollars a barrel, respectively. Also sell off on wheat futures, which capitulate by more than -6% to $ 1,206 a bushel.
Palladium, on the other hand, continues its bullish march, leaping almost + 4% to $ 3,082 an ounce. At around 4 pm Italian time, the Dow Jones leapt by over 600 points (+ 1.91%), to 33,255 points, while the S&P rose by over 2% to 4,252 points. The Nasdaq follows 2.18% at 13,074.
“The stock market continues to take its cue from changes in commodity prices, especially oil,” Kathy Bostjancic, US chief economist at Oxford Economics told CNBC. prime) will retrace, but on the whole the prospect of very high oil prices and also of non-energy products silhouetted a cloud on the outlook for economic activity and on equities “.
Fear of inflation leads US Treasury rates to exceed the 1.90% threshold.
Banking stocks benefit this time: PNC Financial, Wells Fargo, Goldman Sachs and JPMorgan do well. Buy also on the shares of companies, such as those of airlines, most exposed to the increases in oil, gasoline and fuel prices: Carnival and United Air Lines jumped up to over 7%.
World equities are looking at the announcement by US President Joe Biden, who yesterday announced the US’s intention to impose an embargo on Russia’s oil, gas and energy supplies in response to its invasion of Ukraine.
Yesterday, the Dow Jones Industrial Average lost 184.74 points (-0.56%), to 32,632.64. The S&P 500 dropped 0.72% to 4,170.70 while the Nasdaq Composite dropped 0.28% to 12,795.55.
The fear remains that the recent spike in commodity prices could weigh down the US economy, also struggling with the start of a cycle of rate hikes by the Jerome Powell Fed.
Ross Mayfield, an analyst with Baird’s investment strategy division, noted that it will have to be seen whether the Fed can handle a possible soft landing.
In his view, however, the US should be able to dodge a recession.
“The solidity of the US labor market, consumption and corporate sector should chase away the threat of a recession in the short term – said the analyst – Overall, the volatility is likely to persist. There is a wide range of possible implications in Ukraine. , but the fundamentals of the US economy remain decent, and will remain so especially if the Fed manages to raise interest rates without hurting demand. “