Investment

World stocks hit 3-week lows, oil rises on Russia-Ukraine fears

Published

3 years ago

February 21, 2022

Global stocks hit three-week lows and oil rose on Monday as worries increased that Russia will invade Ukraine.

Russian forces killed a group of five saboteurs who breached the country’s southwest border from Ukraine on Monday, news agencies quoted the military as saying, an accusation that Kyiv dismissed as the latest in a series of fakes.

Kyiv and the West fear that a border incident near eastern Ukraine could be used as a pretext for Moscow to attack its neighbour. Russia denies such plans.

Markets are on high alert for any escalation in the crisis.

MSCI’s world equity index fell 0.4% to 700.11, with Monday’s public holiday in the United States, which will keep Wall Street closed, thinning trade and adding to the volatility.

S&P 500 stock futures fell 0.66%. Nasdaq futures dropped 1.2%.

European stocks dropped 1.65% to their lowest in more than four months. British stocks fell 0.5%. Shares in companies exposed to Russia and Ukraine fell heavily.

U.S. stock futures and European stocks lost earlier gains made on news that U.S. President Joe Biden and Russian President Vladimir Putin had agreed in principle to hold a summit on the Ukraine crisis.

The Kremlin said there were no concrete plans in place for a summit, though a call or meeting could be set up at any time.

“The Kremlin made clear today that they are in no rush for a summit with Biden,” said Tim Ash, strategist at BlueBay Asset Management.

British foreign minister Liz Truss said she was stepping up preparations with allies for a worst-case scenario, adding that a Russian invasion of Ukraine was highly likely.

In a reminder of the stakes, Reuters reported Biden had prepared a package of sanctions that includes barring U.S. financial institutions from processing transactions for major Russian banks.

The rouble slid nearly 3% against the dollar and Russian shares slumped 9% their lowest in 14 months.

The U.S. dollar index dipped 0.1% to 95.668, well short of a 1-1/2 year high of 97.441 hit last month.

The euro was little changed at $1.1327, while yields on German 10-year government bonds, seen as Europe’s safest asset, hit two-week lows at 0.185%. [FRX/]

A preliminary Purchasing Managers’ Index survey showed the euro zone economy rebounded sharply this month as an easing of coronavirus restrictions gave a boost to the dominant service industry.

“A Russian invasion of Ukraine would make the job of central banks across Europe much harder,” said Matteo Cominetta, senior economist at Barings Investment Institute.

“Investors should position for even higher uncertainty and probability of policy mistakes.”

Markets are also expecting aggressive policy tightening by the U.S. Federal Reserve as inflation runs rampant. The Fed’s favoured measure of core inflation is due out later this week and is forecast to show an annual rise of 5.1% – the fastest pace since the early 1980s.

At least six Fed officials are set to speak this week and markets will be hyper-sensitive to their views on a possible hike of 50 basis points in March.

Recent commentary has leant against such a drastic step and futures have scaled back the chance of a half-point rise to around 20% from well above 50% a week ago.

In oil markets, Brent crude rose by $1 to $94.41 on the Ukraine crisis, while U.S. crude also gained $1 to $91.98.

Oil had suffered its first weekly loss in two months last week, taking it off seven-year highs, amid signs of progress on an Iran deal that could release new supply into the market.

Iranian foreign ministry spokesman Saeed Khatibzadeh said “significant progress” had been made in talks to revive Iran’s 2015 nuclear agreement on Monday after a senior European Union official said on Friday that a deal was “very, very close”. [O/R]

Gold has benefited from its status as one of the oldest of safe harbours, climbing to nine-month highs of $1,908 an ounce, before dropping back to $1,893 an ounce. [GOL/]

(Additional reporting by Wayne Cole in Sydney; Editing by Catherine Evans)

Investment

Tesla shares soar more than 14% as Trump win is seen boosting Elon Musk’s electric vehicle company

Published

3 days ago

November 6, 2024

Anne Joseph

NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.

Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.

“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”

Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.

Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.

Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.

Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.

In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.

The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.

And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.

Tesla began selling the software, which is called “Full Self-Driving,” nine years ago. But there are doubts about its reliability.

The stock is now showing a 16.1% gain for the year after rising the past two days.

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Investment

S&P/TSX composite up more than 100 points, U.S. stock markets mixed

Published

3 weeks ago

October 16, 2024

Anne Joseph

TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.

The S&P/TSX composite index was up 103.40 points at 24,542.48.

In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.

The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.

The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.

The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.

This report by The Canadian Press was first published Oct. 16, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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Economy

S&P/TSX up more than 200 points, U.S. markets also higher

Published

4 weeks ago

October 11, 2024

Anne Joseph

TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.

The S&P/TSX composite index was up 205.86 points at 24,508.12.

In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.

The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.

The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.

The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.

This report by The Canadian Press was first published Oct. 11, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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