The Dow Jones Industrial Average fell 129.96 points, or 0.4%, to 35,098.19 points; the S&P 500 index was down 10.70 points, or 0.2%, at 4,591.75; and the Nasdaq Composite fell 36.81 points, or 0.3%, to 14,404.50.
Optimism around peace talks was fading as Ukrainian forces braced for new Russian attacks in the southeastern region.
The United States imposed new Russia-related sanctions, while President Vladimir Putin signed a decree requiring foreign buyers to pay in rubles for Russian gas from April 1.
Defensive sectors such as real estate, healthcare and utilities were the only ones to rise among the major S&P sectors. Utilities hit a record and are on track for their best monthly performance since 2002.
The rise in commodity prices caused by the war has raised concerns about inflation, while a tougher Federal Reserve stoked growth concerns, sending all three major US indices to their worst quarter since March 2020.
However, the S&P rallied more than 5% this month on the back of upbeat economic data and a rally in mega-cap stocks.
“Investors are expecting a positive earnings season … so the market is ignoring the recession, the yield curve,” said Peter Cardillo of Spartan Capital Securities in New York.
“It’s the end of the month, the end of the quarter, so there could be some last minute portfolio change. And of course the market will brace for tomorrow’s jobs data.”
European markets
Elsewhere, the MSCI World Stock Index fell 0.3%, while Europe’s STOXX 600 fell 1.2%, down from a one-month high hit on Tuesday.
European indices advanced earlier in the week as investor sentiment was higher regarding the Ukraine peace talks. However, optimism faded after Ukrainian President Volodymyr Zelensky said a quick resolution was not expected and the country was bracing for new Russian attacks.
The STOXX 600 is on track to drop 5.8% in the first quarter of 2022, its biggest quarterly drop since losing 23% in the first three months of 2020.
Raw Materials
In contrast and due to the war between Russia and Ukraine, Gold is on the verge of posting its biggest quarterly gain since September 2020 as its safe-haven appeal was aided by the ongoing war and high inflation concerns.
Bullion gained more than 5% this quarter as the Russian invasion of Ukraine caused gold to hit a near-record level at the beginning of the month in late February. Coupled with the Ukraine crisis, efforts by major central banks to curb inflation help gold perform well.
In that sense, this Thursday it remains on the rise of 0.3% to US$1,940.95 per ounce.
Meanwhile, aluminum prices are also on track to post their biggest quarterly gain since 1988, fueled by supply disruptions and higher production costs as a result of the Russian invasion of Ukraine.
Nickel also stands out and is headed for its biggest quarterly rise since 2003, helped by a squeeze on short positions on the London Metal Exchange (LME) that sent prices soaring this month.
Metals prices are likely to rise further as inflation pushes investors into commodities, while shortages of industrial metals and the risk of further sanctions restricting Russian supply also boost stocks, Wenyu said. Yao, an analyst at ING.
Among the threats to demand are measures to contain the spread of COVID-19 in China, the world’s largest metals consumer. Chinese factory activity contracted in March, but the government has said it will take steps to boost economic growth.
Finally, crude oil prices fell on Thursday after learning that the United States is studying the possibility of releasing up to 180 million barrels from its Strategic Petroleum Reserve, the largest in its almost 50-year history.
Brent crude futures for May were down $5.77, or 5.77%, at $107.68 a barrel. The May contract expires on Thursday and June futures, the most traded, fell $5.08 to $106.36, after shedding more than $6.
Source: Ambito
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