Stock selling intensifies as concerns grow around Ukraine

Yields on 10-year Treasuries, which last week crossed 2% for the first time since 2019, fell about eight basis points, or 0.08 percentage points, to around 1.96%. Yields fall as bond prices rise, which happens when investors buy them as they pull money out of riskier investments like stocks.

But the general nature of Thursday’s selloff highlighted more than one trigger. Oil is trading at prices not seen since 2014, and an invasion by Russia, a major oil producer and Europe’s top supplier of natural gas, would almost certainly drive up energy prices. But on Thursday, oil fell, with West Texas Intermediate, the benchmark for U.S. crude, down 2% to $91.76 a barrel. Natural gas fell more than 4%.

“Concerns about future growth and recession risks are new to traders’ minds,” said Edward Moya, senior market analyst at OANDA. “There are many fears that the optimistic growth outlook for 2023 is on hold.”

Markets have been volatile for months, with concerns over the impact of the Omicron variant on the economy in November and December turning into uncertainty in January and February over continued high inflation and the Fed’s response. Thursday’s decline was the S&P 500’s worst day in just two weeks, and if the index ends this week in the red, it will be its fifth weekly decline just seven weeks into the year. The index is down 8.7% from its January 3 high. The Nasdaq composite peaked on November 19, just before the disclosure of the Omicron variant, and has fallen 14.6% since then.

The Consumer Staples sector was one of the few not to fall on Thursday. Walmart was one of the best performing companies in the S&P 500, climbing 4% after announcing revenue hit $152.9 billion, up 0.5% in the three months ending in January compared to the previous year. The company also said sales from its U.S. business rose 5.7% to about $105 billion in the quarter.

AutoNation fell 3.8% as the company’s chief executive said it was difficult to predict whether it could sustain its current high profit levels in 2022. The company reported earnings of $387 million on Thursday. in its latest quarter, more than double its profit from a year earlier, while revenue rose 14% to $6.6 billion.

In Europe, stock market indices fell slightly. The Stoxx Europe 600 fell 0.7% on Thursday. Asian markets closed on a mixed note.