Stocks were hit by the deepening crisis in Ukraine but honestly speaking the damage was quite limited compared to a lot of foreign indexes where the losses were twice as much (or more). A good economic figure plus a persistent buy the dip mentality held U.S. stocks indexes up quite well. The S&P 500 fell 0.74% and the NASDAQ 0.72%. Russian stocks fell 11% on the day if interested. On the economic front we had 2 reports to watch:
Figures from the Commerce Department had consumer spending rising more than projected in January, with household purchases up 0.4 percent after a minuscule 0.1 percent gain the prior month. The Institute for Supply Management (ISM) said its index of national factory activity rose to 53.2 in February, up from January’s read of 51.3, which was the weakest reading since May 2013. Readings above 50 indicate expansion in the sector.
Today’s drop pushed the S&P 500 back down below those new all time highs they breached late last week after multiple attempts early in the week.
10 Year Treasury yields fell to the 2.6% range today as a “flight to safety” trade – they actually have been falling the past few weeks even as stocks ignore bad economic data. An interesting divergence…usually yields fall as a sign of a slowing economy.
A lot of action came today in the commodities sector, partly due to the typical reaction to global strife, and partly due to risk aversion type moves. We can see gold has continued its resurgence in 2014…
…and oil broke out of a multi week flag. It will be interesting to see if this holds once Ukraine is “resolved”, or if oil will tumble right back down like it did post Syria.
If you are looking for a low risk entry for short/intermediate term trading, Facebook (FB) has pulled back nicely to its 20 day moving average here.
One of the few Russian stocks which trades on U.S. exchanges is Yandex (YNDX) which is their version of Google / Baidu.
Mobil Telesystems (MBT) is another but you can see bargain hunters came in for this stock today as it finished well off its lows. Note the huge volume.