S&P500
The US stock market plunged on Monday amid the Ukrainian conflict and a sharp rise in oil prices.
The Dow lost 2.4%, the NASDAQ fell 3.6%, and the S&P 500 tumbled 3% on Monday.
It has been the largest drop in stock indices in recent months. From the technical point of view, the NASDAQ now trades in the bearish market.
In Asia, Japan's stock index dropped 1.3%, China's fell 1.7%.
Energy: Brent traded at $125 per barrel - the multiyear high - early today. Oil prices have soared since early March. Yesterday, the price skyrocketed as the US and Europe are now contemplating restrictions on Russian oil and gas. Yesterday, natural gas traded at $3,900 per 1,000 cubic meters on the ICE exchange. Later, however, it tumbled to $2,900.
Ukraine: The third round of peace talks between Russia and Ukraine ended on Monday with little progress. Russia demands Ukraine to cede Crimea and recognize the separatist people's republics of Luhansk and Donetsk. Ukraine is not ready to accept these conditions.
The S&P 500 trades at 4,201 and is expected to be in the range between 4,160 and 4,240.
US stocks tumbled yesterday, with the NASDAQ showing the worst performance, down by 3.6%. The S&P 500 stays above the low of February 24 and may rebound from it. If so, the uptrend will resume. It is highly likely, if a major breakthrough is achieved in the Ukrainian conflict.
The plunge came due to the mass outflow of investors from risk assets. Gold is approaching $2,000. Oil and metal prices are on the rise. Under such circumstances, the US Fed may well annonce a rate hike on March 16, thus harming the stock market. US inflation for February, scheduled for March 10, will be the crucial event this week.
Speaking of the pandemic, new cases declined 3.5 times from its highest level worldwide. The total global number of new cases increased by about 1 million yesterday. Overall, the global infection rate is going down.
USDX is at 99.20 and is likely to trade in the range between 98.90 and 99.50. The dollar has shown a significant increase over the past three days, hitting its May 2020 high. The safe haven is in demand due to the Ukrainian conflict.
USD/CAD tardes at 1.2820 and is seen moving in the range of 1.2700-1.2900. The pair surged yesterday as a stronger dollar offset a sharp rise in oil prices.
Summary: The market is expected to show growth if the tense situation surrounding Ukraine improves in recent days and weeks. As for the US stock market, it would be wise to go short from the current levels.
