Daily Markets: Fighting in Ukraine escalates as Biden pushes for American manufacturing

The big picture today

Asian markets closed today’s trade across the board except for South Korea’s KOSPI, which gained 0.16%. China’s Shanghai Composite fell 0.13%, Taiwan’s TAIEX closed 0.17%, India’s Sensex fell 1.38%, Japan’s Nikkei fell 1.68% and Hong’s Hang Seng Kong fell 1.84% on the day. By midday, European stock indices are up across the board and US futures are pointing to a positive market open later this morning.

The recent bullish momentum in the stock market appears to continue today despite rising prices for oil, natural gas, wheat and other commodities this morning as Russian troops captured the Ukrainian port of Kherson. The further rise in oil prices came despite the agreement of the United States and other IEA members to release 60 million barrels from the strategic oil reserve and other emergency stocks. Meanwhile, the EU has agreed to impose new restrictions on Belarus for its involvement in Russia’s invasion of Ukraine and more companies are announcing their intention to cease business with Russia. .

During President Biden’s State of the Union address last night, he focused on infrastructure and the desire to become more self-sufficient. He referred not only to energy, but also to manufacturing, emphasizing Intel (INTC) plans to build a $20 billion semiconductor manufacturing complex in Ohio and calls for physical infrastructure repairs to be “Made In America” ​​from start to finish.

Later this morning, Fed Chairman Powell will begin his semiannual testimony before the House Finance Committee. We expect many questions about the speed of the economy, the potential economic impact of the Russian-Ukrainian conflict and ensuing sanctions, and the pace at which the Fed will begin its interest rate hike. While Powell will answer a number of questions, there’s a good chance he’ll leave details regarding the pace of interest rate hikes in the coming months after the Fed’s upcoming monetary policy meeting. will end on March 16.

Data download

International economy

February’s CPI print for the eurozone rose 5.80% year-on-year, beating estimates by 0.50% and warmer than January’s 5.10% print.

At 10 a.m. ET, the Bank of Canada announces its updated overnight rate target. An increase of 0.25% to 0.50% from the current 0.25% is expected in an effort to stem soaring inflation. Similar to the Fed, the investor expectations predict at least four rate hikes in 2022, with rates expected to reach 1.25% by 2023.

Domestical economy

At 8:15 a.m. ET, the ADP February jobs report will be released and expectations are that 320,000 jobs will have been added, in stark contrast to the 301,000 jobs lost in January. While this is a positive sign and a sign of strength in the economy, we find it difficult to reconcile this with a forecast for Q1 GDP growth that has continued to decline from the Atlanta Fed which fell from 1.30% in mid-February to 0.0% at the last update.

Later this morning at 10:30 a.m. ET, a slew of energy-related metrics will be released covering crude, distillate and gasoline inventories, refinery usage, and various ethanol metrics.

Today at 2 p.m. ET sees the release of the latest Fed report beige book. Investors will dig into it to glean insight into each of the 12 Fed districts contributing to the release. We expect investors to correct the data with comments made today by Fed Chairman Powell (see above) as well as this week’s PMI data from ISM and Markit Economics.


Renewed tensions between Ukraine and Russia weighed on stocks yesterday as Russian forces attacked civilian areas in Ukraine and the Russian Defense Ministry warned of missile strikes on military facilities. Ukrainian intelligence and communication in Kyiv. Released satellite images showed a 40-mile-long convoy of Russian military vehicles approaching Kiev. These developments, combined with oil prices rising above $106 a barrel, led the S&P 500 to lose 1.6% yesterday. Despite lower Treasury yields, the Nasdaq Composite closed down 1.6% while the Dow Jones Industrial Average and Russell 2000 lost 1.8% and 1.9% respectively on the day. Year-to-date, here’s how the major market indicators stack up:

  • Dow Jones Industrial Average: -8.4%
  • S&P 500: -9.7%
  • Nasdaq compound: -13.5%
  • Russell 2000: -10.6%
  • Bitcoin (USD-BTC): -3.8%
  • Ether (ETH-USD): -19.0%

Stocks to Watch

Before trading begins, Abercrombie & Fitch (ANF), Dollar Tree (DLTR), Dycom (DY), and Patterson Companies (PDCO) will post earnings.

Salesforce (CRM) exceeded January quarter expectations with beats on both its upper and lower lines, however, it offered mixed guidance for the current quarter with EPS of $0.93 to $0.94 vs. consensus of $1.00. Revenue for the current quarter is expected to be $7.37-7.38 billion versus consensus of $7.24 billion. Salesforce raised its 2023 revenue forecast to $32.0-32.1 billion from November’s $31.7-31.8 billion.

Amid its quarterly earnings report, Ross Stores (ROST) shared its inland freight costs are up 100 basis points and its ocean freight costs are also higher, causing its freight margin to decline by 50 basis points.

coffee business Dutch Bros (BROS) announced mixed quarterly results as revenue beat expectations while its EPS for the quarter fell by $0.01. Same-store offset sales were up 10.1% year-on-year and the company expressed an outlook for same-store offsets to be in the mid-range for the current quarter. The company announced in November that it had taken a 2.9% price increase and would review its prices every six months.

February 20, Washington International Shippers (EXPD) announced that it was the target of a cyberattack and has now shared that it expects to continue to incur higher cybersecurity spending in the future. The company expects the impact of the previous shutdown and the ongoing impacts of the cyberattack to have a material adverse impact on its business, revenue, expenses, results of operations, cash flow and reputation. . At this stage, Expeditors is unable to estimate the ultimate direct and indirect financial impacts of this cyberattack.

Netflix (NFLX) has agreed to acquire Next Games, a Finnish video game development company licensed to publish mobile games based on Netflix’s “The Walking Dead” and “Stranger Things.”

movie channel AMC (AMC) announced that it was testing variable prices in the United States, which could mean that watching a new movie release could cost more than other movies playing in the same theaters at the same time.

Ford engine (F) is expected to announce a reorganization under which its electric vehicle (EV) and internal combustion engine (ICE) units will be run as separate businesses in a bid to accelerate EV growth.

Last night during his State of the Union address, President Biden announced a ban on Russian planes and airlines from entering US airspace. Although US carriers do not operate nonstop flights to Russia, its airspace is part of a key corridor for many long-haul flights to Asia and will impact air cargo operations handled by companies like FedEx (FDX) and Inverter (UPS). According to IATA data, cargo flights between Asia and North America account for a quarter of global cargo traffic.


No IPO offerings are scheduled for this week. Readers who want to dig deeper into the schedule of upcoming IPOs should visit Nasdaq’s Latest and Upcoming IPOs page.

After today’s market close

American Eagle (AEO), Box (BOX), ChargePoint (CHPT), Okta (OKTA), Signify Health (SGFY), Snowflake (SNOW) and Victoria’s Secret (VSCO) will release their latest quarterly results. Those interested in learning more about which companies release their reports when head to the Nasdaq earnings calendar.

on the horizon

Thursday March 3

  • Japan: Services PMI – February
  • China: Markit/Caixin Services PMI – February
  • Euro zone: Markit PMI Services & Composite PMI – February
  • Euro zone: producer price index – February
  • Euro zone: unemployment rate – January
  • United States: Initial and Continuing Weekly Unemployment Claims
  • United States: Unit labor costs – 4th quarter 2021
  • United States: Markit PMI Services – February
  • United States: Sustainable orders – January
  • United States: Factory orders – January
  • United States: ISM non-manufacturing index – February

Friday March 4

  • UK: CIPS Construction PMI – February
  • Euro zone: Retail sales – February.
  • United States: Employment report – February

Thought of the day

“One day, in retrospect, the years of struggle will seem to you the most beautiful.” ~ Sigmund Freud


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.