Markets “In A Nutshell” for March 7, 2022

Markets “In a Nutshell” for March 7, 2022

Investment Week at a Glance

Stocks finished lower for the week.  The Dow Jones Industrial Average fell 1.30%, the S&P 500 was down 1.30%, and the NASDAQ fell 2.80%. Foreign stocks (MSCI EAFE) were also down, falling 3.20%.  Bond prices were up for the week, with the 10-year U.S. Treasury ending the week at 1.74%.  (Data source: Wall Street Journal)

Russia-Ukraine Market Reactions

With the Russian invasion of Ukraine still taking place, the market has had a lot to digest as sanctions and effects on the market take place. The main headline from the war from an economic and market standpoint is energy prices. Oil spiked as high as $116 a barrel last week and reached $130 just this Monday morning. With inflation already an issue in the United States many are worried about just how much prices at the pump with increase. Interest rates have also dipped recently due to growth worries as the conflict in Europe continues. The Fed is now in a tough situation as with worries of war how much will they be able to raise rates. Before the war, it seemed as if we could have 9 or more rate hikes this year but now that seems unlikely.

Market Volatility & the Economy

The market had been starting to pick up some volatility before Russia invaded Ukraine and with the invasion, the volatility has only continued to heat up. The market is having to digest tighter Fed policy as well as the largest invasion in Europe since WWII. These situations will cause some uncertainty for the future of business around the world. However, the economy in the United States is not in a terrible situation as more people have been getting back to work. The unemployment number is now at 3.8% and more people joined the labor force last month. With the economy still growing, corporate earnings are still on the rise and should be a catalyst for the market in the long run. Although the conflict in Ukraine is terrible from a geopolitical and humanitarian point of view, markets tend to not worry in the long run from smaller wars such as this.

Quiz:

What is the highest price of U.S. Crude oil in history? (Scroll Down for Answer)

1.     $147 per barrel
2.     $156 per barrel
3.     $172 per barrel
4.     $193 per barrel

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

 

 

Answer:

1)   $147 per barrel, on July 11, 2008, U.S. Crude oil reached an all-time high. We recently saw prices as high as $130 per barrel. With the possibility of banning the import of Russian oil it will be interesting to see if we top the previous all-time high.