Stock futures struggle as Wall Street eyes geopolitical updates
The Dow eyes a triple-digit drop
Raise tensions between Ukraine and Russia sent equity futures lower this morning, with the Dow Jones Industrial Average (DJI) eyeing a triple digit drop, and the S&P 500 (SPX) and Nasdaq-100 Index (NDX) pointing out their own silent losses. Investors began chasing after markets reopened after Monday’s President’s Day shutdown, after Russian President Vladimir Putin yesterday said he would recognize the independence of two breakaway regions in eastern Ukraine, which could undermine peace talks with the United States, prompting President Joe Biden to order sanctions against Ukrainian breakaway regions. Several other countries also announced sanctions or trade agreements with Russia this morning.
Meanwhile, oil prices are rising on the news, with West Texas Intermediate futures last up 3% at $93.80 a barrel. Wall Street looks to another round of earnings as the season begins to wind down, digesting upbeat results from retailers Macy’s (M) and Home Depot (HD).
Keep reading to learn more about the current market, including:
- the pot broths who made international moves last week.
- Is it safe to add this insurance stock in your wallet right now?
- Moreover, M increases with earnings; Houghton Mifflin stock rose on takeover news; and DKNG goes deeper after the bear note.
5 things you need to know today
- The Cboe Options Exchange (CBOE) saw 1.58 million buy contracts traded on Friday and 1.15 million sell contracts. The single-session sell/buy ratio rose to 0.73 and the 21-day moving average to 0.56.
- The actions of Macy’s Inc (NYSE:M) are up 6.2% this morning, following the company’s fourth quarter earnings and revenue, as well as the approval of a new $2 billion share buyback plan and an increase in dividends. M has reached an impressive 79% over the past 12 months.
- Private equity firm Veritas Capital will acquire Houghton Mifflin Harcourt Co (NASDAQ: HMHC) in a deal worth $21 per share or $2.8 billion in cash, sending shares of the latter up 15.1% before the bell. HMHC climbed more than 174% year-over-year, helped by its 60- and 100-day moving averages.
- DraftKings Inc (NASDAQ: DKNG) secured a demotion from Wells Fargo to “equal weight” from “overweight,” as well as a sharp reduction in target price to $19 from $41, citing profitability concerns. Shares are down 5.3% before the bell, looking to add to Friday’s 21.6% plunge.
The market will reopen with a bang Tuesday, with the S&P Case-Shiller Home Price Index, FHFA Home Price Index and Consumer Confidence Index all due. Investors will also want to watch the Markit Services and Manufacturing Purchasing Managers’ Indexes (PMIs), which will be released shortly after the open.
Russian-Ukrainian tensions continue to weigh abroad
Asian markets were down sharply today, victims of ongoing tensions between Russia and Ukraine. Hong Kong’s Hang Seng led the losses with a 2.7% drop, as Alibaba fell following a Bloomberg Report that Chinese officials have asked banks and state-owned enterprises to verify their financial exposure through Ant Group. Japan’s Nikkei fell 1.7% on the day, while China’s Shanghai Composite and South Korea’s Kospi lost 1% and 1.4% respectively.
European markets struggled to orient themselves at midday, as investors watched for updates on the Russian-Ukrainian border and released a slew of corporate earnings. Germany’s DAX was down 0.2%, despite Germany’s Ifo business climate index rising to 98.9 in February, while London’s FTSE 100 edged down 0.3%. To complete the region, the French CAC 40 remained stable with a drop of 0.01%.