4.02pm: Equities end higher
US markets ended with significant gains as Russia agreed to talk to Ukrainian diplomats amid the geopolitical crisis.
On Friday, the Dow Jones Industrial Average ended with sharp gains of over 800 points, or 2.5% at 34,058, while the S&P 500 added 2.2% at 4,384, and the Nasdaq Composite rallied with gains of 1.6%, ending at 13,695.
Stocks were trending upwards following the Kremlin official’s announcement on sending a delegation to Belarus to meet with Ukrainian officials– hinting that Russian President Vladimir Putin is open to negotiations.
For the week, however, the Dow is lower, while the other two major indices– the S&P 500 and the Nasdaq Composite– are ending with gains.
The Nasdaq Composite still continues to trade in the correction zone, while the S&P and the Dow are trading on the brink of the correction territory.
12.15pm: Equities in the green
US stocks rallied midday on Friday after Moscow agreed to have a conversation with Kyiv bureaucrats amid an escalating battle between Ukraine and Russia.
At noon, the Dow Jones Industrial Average added over 650 points, or 2% at 33,890, while the S&P 500 was up by 1.8%, and the Nasdaq Composite gained 1%.
The blue-chip average is on its way to record the best day in 2022, while other major indices continued to look up. Among the top gainers on the Dow were Merck and Johnson & Johnson (NYSE:JNJ), both adding 4%.
“While the situation in Ukraine continues to keep markets on edge, we have seen a recovery in risk appetite this afternoon,” Chris Beauchamp, chief market analyst at online trading platform IG. “Whether this lasts long into next week is a much bigger question.”
Investors are fretting about the anticipated Federal Reserve interest rate hikes as early as mid-March, while the geopolitical crisis continues to intensify inflationary pressure on the global markets.
Beauchamp warned that this afternoon could be another one of those false dawns for risk assets. “They have been able to weather news of the invasion relatively well, but the weekend provides plenty of scope for headline risk to develop and prompt another leg down on Monday.”
10.05am: Markets roiled by conflict
US stocks were mixed at the open on Friday, following a roller-coaster session on Thursday, as investors continued to weigh Russia's invasion of Ukraine and the implications of the sanctions imposed on it amid the escalating geopolitical crisis.
In early trading, the Dow Jones Industrial Average was up by 0.4% or 141 points, at 33,365, while the S&P 500 gained 0.1%, but the tech-laden Nasdaq Composite shed 0.8%.
After hefty early falls on Thursday, the Dow Jones Industrial Average ended with gains of 0.3%, while the S&P 500 was up by 1.5% at 4,288, and Nasdaq Composite rebounded 3.3%.
Craig Erlam, senior market analyst, UK & EMEA, OANDA noted: “It's a remarkable turnaround when you consider that the invasion is still taking place and sanctions are being drawn up. There is still huge uncertainty around how bad the situation will get, given how quickly it has escalated over the last few days, which makes the shift in risk appetite all the more surprising.”
Considering how rapidly this has evolved and how volatile the markets have been for weeks, Erlam said, "I wouldn't be surprised to see sentiment continue to bounce back and forth."
Oil is back trading at below $100 per barrel, as gas prices also fell after Thursday’s surge.
On the corporate front, Etsy (NASDAQ:ETSY) shares climbed Friday after the company posted better-than-expected fourth-quarter results, while Beyond Meat shares plummeted after disappointing earnings.
Meanwhile, a key inflation scale - the core personal consumption expenditure price index - was up by 5.2% compared to the previous year and slightly higher than an estimate of 5.1%. The Federal Reserve’s primary inflation gauge was the highest since April 1983.
6.30am: US stocks seen opening down
US stocks are expected to start the day lower, reversing a late Thursday rebound, as Russian forces enter Kyiv, raising concern of a tank attack on Ukraine’s capital following a night of explosions in the city.
Futures for the Dow Jones Industrial Average declined 0.86% in Friday pre-market trading, while those for the broader S&P 500 index also fell 0.86% and the tech-heavy Nasdaq shed 0.8%.
US markets staged a turnaround in the previous session, recovering steep losses from earlier in the day, as the US imposed fresh sanctions against Russia after President Vladimir Putin ordered the start of military operations in Ukraine. Investors were relieved that the new measures didn’t include energy or restricting Russian access to Swift, a global messaging system for financial transactions.
The Dow Jones Industrial Average ended with gains of 92 points or 0.28% at 33,224, while the S&P 500 was up by 1.5% at 4,289 and the Nasdaq saw a sharp rise of 3.34% to 13,474.
Among the stocks bought in the dip were Amazon, Netflix, Alphabet, and Microsoft.
“The Nasdaq Composite entered bear market territory, then reversed, turning a 3.5% loss into a gain of 3.3% for the session,” commented Neil Wilson, chief market analyst at Markets.com.
"Reasons for the turnaround? Chiefly we can say that markets sold off aggressively early yesterday on fear – fear of sanctions rather than a fear for the future of Ukraine. The absence of any sanctions on Russia oil and gas, and the decision to not exclude the country from the Swift payments network left the market breathing a sigh of relief as to the global economic impact the invasion might have," Wilson added.