US Stocks Up 4th Day in Row on Russia-Ukraine Peace Talks, Economic Optimism
NEW YORK (Sputnik) - US stocks rose broadly for a fourth session in a row on Tuesday as Russia and Ukraine made progress in peace talks while oil prices and Treasury yields fell again, allaying investor concerns over inflation despite the Federal Reserve keeping to its tough language on rate hikes.
Wall Street’s three stock indexes - the S&P 500, the Dow Jones Industrial Average and the Nasdaq Composite - closed up 1.4% on the average. Nasdaq, which houses the biggest technology names of the world, including Amazon, Apple, Netflix and Google, rose almost 2% on its own to lead gains.
The US ten-year Treasury note, which serves as an indicator of "real interest rates," fell for a third day in a row, declining 3.1% on Tuesday and a total of 4% since Thursday's close.
Oil prices fell 2%, extending Monday’s 7% tumble as the US crude benchmark briefly traded beneath the $100-per-barrel support amid twists and turns in Russia-Ukraine peace negotiations. Russia’s top negotiator Vladimir Medinsky called the talks "constructive" and said a Moscow-Kiev summit was possible as soon as a peace agreement was ready. Medinsky also said Russia does not oppose Ukraine joining the European Union. In addition, he said Ukraine promised to refrain from joining military alliances.
On the US economic front, job openings hovered near record highs in February as vacancies continued to outpace hires in an unemployment market that remained overwhelmingly in favor of workers, the government’s monthly Job Openings And Labor Turnover Summary report showed.
US consumer confidence, meanwhile, rose for the first time this year in March despite inflation and economic fallout likely from the war in Ukraine remaining high on Americans’ worry list, The Conference Board said. Consumer spending accounts for about 70% of US annual growth.
Despite such encouraging data, Philadelphia Federal Reserve President Patrick Harker warned that inflation was "running too high" and economic growth would likely be capped at 2.5% over the next two years.
US inflation, measured by the Consumer Price Index (CPI), grew 7.0% in 2021, and 7.9% during the year to February - both at their fastest in four decades. The CPI’s expansion outpaces GDP, or gross domestic product, growth at 5.7% last year and projected by the Fed at 2.8% this year.
Federal Reserve policy-makers like Harker have a mere tolerance of 2% for inflation in a year. They have vowed to bring inflation back to their target with a series of rate hikes through 2023. The central bank approved its first pandemic-era rate hike on March 16, raising rates by 25 basis points, or a quarter percentage point. Harker, commenting on the central bank's forthcoming action, said he “wouldn't rule out a 50-basis-point rate hike at the next meeting” of the central bank in May.
In Tuesday’s trading on Wall Street, the S&P 500, which groups the top 500 US stocks, closed up 58 points, or 1.3%, at 4,633.
The Dow Jones Industrial Average, which lists travel, aviation and cross-industry value stocks, rose 338 points, or almost 1%, to settle at 35,372.
The Nasdaq Composite finished up 265 points, or 1.8%, at 14,620.