By Market Snapshot: Nasdaq books best day in more than a week after Elon Musk’s Twitter stake prompts investors to snap up tech shares
U.S. stocks edged higher Monday midday as investors shook off the prospect of further sanctions on Russia over the war in Ukraine.
After the S&P 500 index posted a third straight week of gains on Friday, evidence of potential war crimes by Russia over the weekend prompted the EU and U.S. to push for new penalties after reports that Russian troops executed unarmed civilians in Ukrainian towns.
What’s happening
The Dow Jones Industrial Average
DJIA,
+0.10%
was up 55 points, or 0.2%, at 34,870.
The S&P 500
SPX,
+0.59%
was up 25 points, or 0.6%, at 4,571.
The Nasdaq Composite
COMP,
+1.67%
rose 222 points, or 1.6%, to trade at 14,484.
On Friday, the Dow logged a 0.1% weekly fall, after back-to-back weekly gains. The S&P 500 eked out a 0.1% gain for the week, while the Nasdaq Composite advanced 0.7%, with both logging their third straight weekly gain.
What’s driving the market
Investors were monitoring the latest developments in Ukraine. German Chancellor Olaf Scholz said Sunday that Western nations will impose additional sanctions on Russia in the coming days.
Meanwhile, investors remained focused on the Federal Reserve, with minutes from the central bank’s March policy meeting, at which it raised the fed-funds rate by 25 basis points, due on Wednesday. They will be parsed for clues to policy makers’ plans for future moves, in particular the pending shrinking of the Fed’s nearly $9 trillion balance sheet.
Investors, economists and analysts continue to debate the implications of moves along the Treasury yield curve. The yield on the 2-year Treasury note last week moved above the 10-year rate, inverting that closely watched measure of the curve, which has served as a reliable recession indicator, albeit with median lag of around a year-and-a-half.
“This is a tricky environment for equities. The bond market is saying the risk of an ‘accident’ is very high as rising rates could break a financial system that’s swimming in leverage, but on the other hand, the economy is booming and real yields are still negative,” wrote Marios Hadjikyriacos, senior investment analyst at XM, in a note.
Read: Why an inverted yield curve is a bad tool for timing the stock market
That leaves equity investors with little choice but to “hold on,” the analyst said.
“With bonds selling off and commodities at the mercy of geopolitics, there just aren’t many attractive investment opportunities outside of the stock market. That sets the stage for some choppy trading, until it becomes clearer whether a recession is really on the cards,” he said.
Oil prices
CL00,
+2.93%
pushed higher, bouncing after a sharp drop last week sparked in part by a U.S. announcement of an unprecedented release of strategic reserves to fight rising energy costs.
Companies in focus
In corporate news, shares of Twitter Inc. TWTR jumped more than 25% after a regulatory filing showed that Tesla Inc. TSLA boss and world’s richest man Elon Musk had acquired a 9.2% stake in the social-media platform.
Starbucks Corp.
SBUX,
-4.73%
on Monday said it would suspend its stock-repurchase program, effectively immediately, as Howard Schultz returns to the company as chief executive. Shares fell 5.2%.
Check out: Twitter stock rockets after Elon Musk takes stake valued at more than $3 billion
What other assets are doing
The yield on the 10-year Treasury note
TMUBMUSD10Y,
2.411%
rose 3.9 basis points to 2.415%. Yields and debt prices move opposite each other.
The ICE U.S. Dollar Index
DXY,
+0.32%,
a measure of the currency against a basket of six major rivals, was up 0.2%.
Bitcoin
BTCUSD,
-1.30%
fell 1.7% to trade near $45,700.
Gold futures
GC00,
+0.70%
rose 0.6% to around $1,935 an ounce.
The Stoxx Europe 600
SXXP,
+0.84%
rose 0.8%, while London’s FTSE 100
UKX,
+0.28%
was up 0.3%.
The Hang Seng Index
HSI,
+2.10%
jumped 2.1% in Hong Kong, while Japan’s Nikkei 225
NIK,
+0.25%
edged up 0.3%.
