4.05pm: S&P 500 sees second winning week in a row
US stocks finished the trading session mixed as 10-year interest rates hit a new high and Russia was slapped with more sanctions as the Ukraine conflict shows no signs of subsiding.
At the close, the Dow gained 154 points to 34,862, while the S&P 500 added 23 points at 4,543 and the tech-heavy Nasdaq eased 23 points to 14,169.
Financial stocks, such as Bank of America (NYSE:BAC) and Wells Fargo, got a boost after the benchmark 10-year rate hit a fresh multi-year high of 2.5%.
12:00pm: US equities down midday
US stocks were down midday Friday as investors grappled with a hawkish Federal Reserve and stagflation concerns against the backdrop of the ongoing war in Ukraine.
As interest rates shoot higher, the US central bank is set to hike rates several more times this year to fight inflation.
As of noon, the Dow Jones Industrial Average was down 19 points, or 0.06%, to 34,688. The S&P 500 was down 10 points, or 0.22%, to 4,509.
And the tech-heavy Nasdaq dropped 156 points, or 1.10%, to 14,035.
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10.14am: US benchmarks start mixed
US stocks started in New York mixed as the uncertain mood continues for investors.
The Dow Jones Industrial Average added around 104 points at 34,812. The S&P 500 added around four points to 4,524. But the tech-heavy Nasdaq index shed around 48 points to stand at 14,143.
US indices have been shifting between gains and losses this week as concerns over inflation and Russia’s invasion of Ukraine and the question of its duration and affects continue to be top of the agenda.
Today, the 10 year US Treasury yield hit a new two-year high as investors expect a more aggressive Fed on monetary tightening this year. The rate hit 2.475%, which is the highest level since May, 2019.
On Monday this week, Fed Chair Jerome Powell made comments that inflation was running too high and that the Central bank would continue to raise interest rates until it was under control.
7.30am: US stocks set to go higher
US stocks are seen opening modestly higher on Friday, reflecting continued worries over inflationary pressures and spikes in commodity prices amid the continuing war in Ukraine and the prospect of higher interest rates in the world's biggest economy.
On Thursday, US president Joe Biden warned that Nato would respond if Russia began to use chemical weapons in Ukraine. His remarks led to worries of a further escalation in the war, and in turn, over the growth-dampening effects of the war.
Futures for the Dow Jones Industrial Average were up 0.1%, while those for the S&P 500 were also up 0.1% and contracts for the tech-heavy Nasdaq-100 rose 0.2%.
“Wild price moves and jaw-dropping margin calls push many investors out of the commodity markets, which, in return, reduce liquidity and has a boosting effect on price volatility,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
“Nickel has clearly become the face of that wild volatility, as the price surged 15% to the limit for the second day in a row yesterday. The rising commodity prices further boost inflation expectations and the central bank hawks, weigh on government bonds, yet equity traders remain surprisingly bullish," she added.
Separately, the EU’s inability to slap an embargo on Russian oil helped dampen oil prices but benchmark Brent crude was still trading at just over $115 a barrel, while gold - seen as a safe haven in the midst of uncertainty - was at around $1,958 an ounce.
Ozkardeskaya noted that for oil prices: “The long-term outlook remains comfortably bullish as the combination of tight global supply, and the expectation that the global oil demand will reach a record high in the second half of the year should throw a floor under the short-term price pullbacks.”
US data on Thursday came in on the strong side with the manufacturing and service sectors showing strong growth while weekly jobless claims dropped to their lowest in decades. The latter reflects US Federal Reserve chairman Jerome Powell’s remarks earlier in the week that the US labor market is strong, underscoring the need for interest rates in the world’s biggest economy to rise rapidly.
A US consumer confidence survey, due out at 11.00am ET, will be in focus, especially if it continues to point toward pessimism, adding to market volatility.
Contact the author at jon.hopkins@proactiveinvestors.com