Friday March 11th

U.S. stock market index futures rose ahead of Friday’s session following a report that ceasefire talks could be gaining traction between Russia and Ukraine. Russian President Vladimir Putin said that “certain positive shifts” have occurred in the talks. The report coincided with a sharp acceleration in stock futures, with the Dow Jones Industrial Average futures up 310 points or 1%, the S&P 500 rising 1.1% and the Nasdaq 100 jumping 1.3%. “The S&P 500′s -12% decline from its peak suggests much of the froth has been taken out,” said Savita Subramanian, equity and quant strategist at Bank of America Securities. “Stocks are largely pricing in the geopolitical shock, where the S&P 500 fell 9% from peak-to-trough since Russia-Ukraine headlines in early Feb, similar to a typical 7-8% fall in prior macro/geopolitical events.” The moves came despite another day of higher energy prices, though they were well off their highs following the report on Putin’s comments. West Texas Intermediate crude, the U.S. benchmark, rose 1.4% to $107.46 while international standard Brent crude moved 1.6% higher to $111.04. Metals prices except for copper fell sharply. Palladium futures tumbled 4% to $2,803.50 an ounce. Agricultural commodity prices turned mixed and bond yields were mostly higher, though only slightly. Tensions continued to heat up on the Ukraine situation, with U.S. President Joe Biden expected to call for an end to Russia’s status as a preferred trade partner, according to a Bloomberg News report. Also, Congress passed a funding bill that includes $14 billion of Ukraine aid. Shares of Rivian slipped more than 11% in extended trading after missing estimates for the fourth quarter on the top and bottom lines, while DocuSign sank 18% after issuing weak guidance for the first quarter and fiscal year. The main event on the economic calendar Friday is the preliminary reading for the University of Michigan consumer confidence survey, expected to nudge higher to a reading of 62 from 61.7 in February. Investors received more bad inflation news Thursday, as the Bureau of Labor Statistics reported that the consumer price index rose 7.9% in February, even more than expected and the highest level since January 1982. CPI gained month-over-month 0.8%, above estimates of 0.7% for the month, translating to a 0.8% decline in real average hourly earnings for workers. Treasury Secretary Janet Yellen offered little consolation on the inflation front, telling CNBC that she expects price increases to be a fact of life in the U.S. for another year. In trading Thursday, the Dow dipped more than 112 points, after climbing more than 650 points in the previous session. The S&P 500 shed 0.4%. The Nasdaq Composite, home to many of the market’s biggest tech names, dropped 1%. Week to date, the Dow is down 1.31% and headed for its fifth negative week in a row since May 2019. Meanwhile, the S&P is down 1.60% and Nasdaq 1.38% this week. The losses came as negotiations between Russia and Ukraine came to a halt without progress on a cease-fire or passage for civilians attempting to flee the city of Mariupol. The markets have fluctuated in recent weeks as investors weigh the fallout of the conflict between Russia and Ukraine. “History from an investment point of view is on our side for the long-term,” Stephanie Link, Hightower’s chief investment strategist told CNBC’s “Closing Bell” on Thursday. “The market can recover, and I think eventually we will. We’ll have to see how long this goes but eventually, the market will recover.” Shares in Asia-Pacific slipped in Friday trade, tracking overnight losses on Wall Street as the Russia-Ukraine war continues to keep investors cautious. The Nikkei 225 in Japan fell 2.05% to close at 25,162.78, shedding some of its nearly 4% gain on Thursday. The Topix index slipped 1.67% to 1,799.54. Hong Kong’s Hang Seng index, which earlier fell more than 3%, partially recovered but still closed 1.61% lower at 20,553.79. The Shanghai composite in mainland China closed 0.41% higher at 3,309.75 while the Shenzhen component climbed 0.618% to 12,447.37. Both indexes had fallen more than 2% during the session before recovering. In South Korea, the Kospi dipped 0.71% on the day to 2,661.28. Oil prices rose on Friday on continued concerns about supply disruptions for Russian oil and oil products, but were on track for their biggest weekly decline since November after another volatile week. Oil prices soared after Russia invaded Ukraine and hit their highest levels since 2008 but have pulled back a bit this week on hopes that some producing countries may act to increase supply. Fears about escalating bans on Russian oil persist, however, and were back in focus again on Friday. Brent crude futures climbed $2.86, or 2.6%, to $112.19 a barrel. U.S. West Texas Intermediate (WTI) crude futures were up $2.71, or 2.6%, to $108.73 a barrel. Brent was on track for a weekly fall of 5.4% after hitting $139.13 on Monday. U.S. crude was headed for a weekly drop of 6.2% after touching a high of $130.50 on Monday. Both contracts last touched these price peaks in 2008. Gold eased on Friday, consolidating at the end of a volatile week as investors sized up potential rate hikes from the U.S. Federal Reserve, but analysts warned an escalation in Ukraine could spur further safe-haven demand. Spot gold was down 0.3% at $1,991.20 per ounce by 1050 GMT, but remained poised for a weekly rise of about 1.2%. U.S. gold futures were down 0.1% at $1,997.70.