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Trading Week Summary

The Nasdaq composite index fell 2.18% this week, while the S&P 500 was down 1.82%. The Dow Jones industrial average fell 1%.

Today (Friday), the stock market falls sharply after a surge in oil prices to $93.75 per barrel in response to growing concerns that Russia will take military action against Ukraine.

U.S. National Security Adviser Jake Sullivan said at a White House briefing that there were signs of an escalation in Russia on the Ukraine border and that an invasion might occur during the Olympics, despite speculation. Both the US and the UK have called on their citizens to leave Ukraine as soon as possible.

Defence stocks are rising after headlines in Ukraine began to emerge. Lockheed Martin up 2.77%.

Energy stocks are rising alongside the oil price, with the energy sector strengthening 2.84% today (Friday).

U.S. inflation data were released this week, showing consumer prices jumped to 7.5% last month compared with a target of 7.3%. The highest increase since February 1982.

The hoter-than-expected inflation reading prompted the Fed president to call for an acceleration of interest rate increases. However, Fed officials said they did not expect a March 50 basis point move to be appropriate. The Fed typically moves at 25 basis point intervals. The futures market pointed to a 70% chance of a 50 basis point increase at the March meeting.

The yield on the 10-year Treasury bond jumped to more than 2% this week for the first time since 2019, and is now trading at 1.96%. The five-year yield is trading at 1.87%. The narrowing of spreads in bond yields and the beginning of the flattening of the curve indicates that a period of economic slowdown in the United States will affect weakness in bank stocks.

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