Stocks rise, oil slips as investors watch Ukraine negotiations

Investors said positive comments from both Ukrainian and Russian officials about round of negotiations Markets strengthened Monday. The technology-focused Nasdaq Composite Index rose 0.4%.

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Decreased by 1% with the outbreak of Covid-19 in China Manufacturing disruption by a major supplier in Shenzhen City.

While lower oil prices could ease fears of slowing consumer spending amid a record hike in gasoline prices, one possible reason for the drop in oil – the Covid-19 outbreak in China – could renew concerns about a potential supply chain and the resulting impact on the global economy. American economy. Shortages in everything from computer chips to chocolate stymied growth for months as the Omicron variant scrambled business plans and raised costs for companies large and small. small business.

“China shutdown and potential supply chain issues, people are scared of that,” said Joe Saluzzi, co-head of equity trading at Themis Trading. “Just as you thought you were getting relief in the supply chain, we may take another hit.”

He said potential economic losses could negate expectations of a rate hike by the Federal Reserve later this year. Investors are turning their attention to Federal Reserve monetary policy meetingwhich concludes on Wednesday. The central bank is expected to raise its benchmark interest rate for the first time since 2018 as officials look to cool demand and bring inflation under control. She navigates an extraordinarily complex environment of a tight job market, supply turmoil and, most recently, the war in Ukraine.

China’s Shanghai Composite Index fell 2.6% After Shenzhen went into lockdown to contain the coronavirus. In Europe, the Stoxx Europe 600 Index rose 0.9%, led by shares of automakers and banks.

The shutdown could hamper demand for oil, and Brent crude futures, the international benchmark, fell 5.6% to $103.19 a barrel. A week ago, Brent crude prices hit $139 a barrel, the highest since 2008, as the war in Ukraine disrupted global commodity markets.

The yield on the 10-year Treasury rose to 2.09% on Monday from 2.004% on Friday. Yields are moving in the opposite direction to bond prices and are on track to reach their highest close since July 2019.

Elsewhere in the commodity markets, nickel trading remained suspended on the London Metal Exchange, which halted the market last week to contain a Big price hike.

Said Edward Park, chief investment officer of Brooks McDonald. “Expectations were very low at the end of last week.”

“There is certainly a risk of a bout of volatility in the short term if negotiations are paused or appear to be heading in the wrong direction,” he added.

Despite hopes for negotiations, the Conflict is increasing There is growing concern among officials and investors that the war could spread beyond Ukraine. A Russian air strike on a Ukrainian military training center near the Polish border killed 35 people on Sunday. Russia has asked China for military equipment and other aid for its war effort, according to US officials.

Write to Joe Wallace at [email protected]