OIL prices fell and European stocks rose on Monday as investors weighed positive comments from ceasefire talks between Russia and Ukraine, while US Treasury yields hit two-and-a-half year highs on expectations of a first US rate hike.
US stocks were mostly lower as investors remained cautious on the Ukraine conflict with the market focus on this week’s Federal Reserve meeting.
Russian and Ukrainian officials gave their most upbeat assessments on Sunday of progress in their talks to end the conflict with some delegates saying draft agreements could be reached within days.
European stocks closed higher on the tentative hopes of progress in the peace talks, while oil prices retreated to their lowest in two weeks on the prospects of increased global supplies.
“Everything seems to be heading towards an acute point where we should have some headway. The fact is neither side has a complete edge and as a result, talks are the most sensible outcome, with some type of resolution,” said Thomas Hayes, chairman at Great Hill Capital in New York.
On Wall Street, the benchmark S&P 500 and the tech-heavy Nasdaq fell as traders sold big growth stocks ahead of the Fed’s meeting on Wednesday when the US central bank is expected to raise interest rates for the first time in three years.
The Dow Jones Industrial Average rose 1.05 points to 32,945.24, the S&P 500 lost 0.74% to 4,173.11 while the Nasdaq Composite dropped 2.04% to 12,581.22.
Investors expect the US central bank to hike rates more aggressively this year after data on Thursday showed that annual inflation in February rose at the fastest pace in 40 years, forcing Americans to dig deeper to pay for rent, food and gasoline.
Benchmark US 10-year yields rose to 2.1419%, the highest since July 2019.
The pan-European STOXX 600 index rose 1.2% while the MSCI’s gauge of stocks across the globe shed 0.74%. Overnight in Asia, the Nikkei 225 index closed up 0.58%.
Brent futures fell 5.1% to settle at US$106.90/barrel, while US West Texas Intermediate crude fell 5.8% to settle at US$103.01.
The US dollar dipped modestly against a basket of currencies but remained near a 21-month high hit last week as investors eyed Russia-Ukraine peace talks. The US dollar index fell 0.056%.
Safe-haven gold prices fell as US Treasury yields rose. Spot gold dropped 1.6% to US$1,952.87/ounce while US gold futures fell 0.91% to US$1,959.60/ounce. – March 15, 2022
