US equities fell for the third straight trading day on Tue. The S&P 500 Index closed in “correction territory.” It is now more than 10% below its all-time high. However, the market’s drop on Tue was less than many had feared.
The Dow Jones Industrial Average lost 482.57 pts, or 1.42%, to close at 33,596.61. The S&P 500 index fell 1.01%. The tech-heavy Nasdaq Composite retreated 1.23%. The small cap Russell 2000 dropped 1.45%.
The sanctions against Russia announced by US President Joe Biden over Moscow's recognition of Ukrainian separatist regions were not as comprehensive as earlier mooted. European Union (EU) sanctions were at least as severe. The EU sanctions target Russian banks, "oligarchs", and the 351 lawmakers who voted in favor of the recognition.
Germany halted the certification of the Nord Stream 2 gas pipeline designed to bring natural gas from Russia directly to Europe. The certification process has been assigned to a member of the Green Party, which effectively dooms Nord Stream 2 for as long as present coalition government is in power
Home Depot (HD US, -8.85%) and Macy’s (M US, -4.98%) shares fell after both warned of challenges from inflation and supply chain issues.
The 10-year Treasury note yield notched up 1.04 basis points (bps) to 1.9390%.
The most actively traded US gold futures (Apr) contracts settled up $7.60, or 0.4%, at US$1,907.40/oz. March silver, which is the most actively traded silver futures, rose 31.9 cents, or 1.3%, to end at US$24.311/oz.
Bitcoin dropped to a more-than-two-week low of $36,372, undermining the argument that cryptos are a haven in times of geopolitical turmoil.
The ICE dollar index (DXY), which measures the strength of the greenback against a basket of currencies, fell 0.06% to 96.025.
The front-month Brent and WTI futures closed up $1.45 at US$96.84/bbl and $1.28 at US$92.35/bbl respectively.
The UK FTSE gained 0.13%, France's CAC 40 fell 0.01%, while the German DAX retreated 0.26%. Volkswagen (VOW GR, +6.77%) is preparing an initial public offering of Porsche.