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U.S. stock index futures were slightly higher in early trade Wednesday after the S&P 500 index closed in correction territory Tuesday, down more than 10% from its record high on Jan. 3, in the wake of Russian President Vladimir Putin’s decision to order troops to breakaway regions of Ukraine, escalating tensions and raising fears of a full-scale invasion.
Global stocks broke a four-day fall as demand for safe haven assets waned on Wednesday, with investors waiting to see Putin’s next move.
How are stock-index futures trading
-
Dow Jones Industrial Average futures
YM00,
+0.79%
were up 253 points, or 0.75%, at 33,778. -
S&P 500 index futures
ES00,
+0.95%
were up 38 points, or 0.88%, at 4,338. -
Nasdaq-100
NQ00,
+1.33%
index futures rose 167 points, or 1.20%, at 14,029.
On Tuesday, the Dow Jones Industrial Average
DJIA,
dropped 482.57 points, or 1.4%, to close at 33,596.61, its lowest finish since June 18, according to Dow Jones Market Data. The S&P 500
SPX,
fell 44.11 points, or 1%, to end at 4,304.76, the lowest closing value since Oct. 4. The Nasdaq Composite
COMP,
shed 166.55 points, or 1.2%, to finish at 13,381.52.
What’s driving the market?
Sentiment soured further in the U.S. stock market Tuesday after Putin ordered forces into separatist regions of eastern Ukraine on Monday, raising fears that an invasion was about to materialize.
President Joe Biden on Tuesday said the U.S. would sanction two Russian banks as well as the country’s sovereign debt, as he blamed Moscow for what he called the beginning of an invasion of Ukraine. Earlier on Monday Biden had issued an executive order barring new investment, trade and financing by U.S. persons in the breakaway regions where Russia sent troops.
Meanwhile, officials from the European Union referred to Putin’s latest moves, including the recognition of the independence of the Russian separatist Donetsk and Luhansk regions’ independence, as “a blatant violation of international law.” And Germany took steps to halt certification of the Nord Stream 2 pipeline that’s set to carry natural gas from Russia to Western Europe.
“We can expect markets to remain volatile as they will have knee-jerk reactions over the next few days as the situation develops,” Nigel Green of financial advisory and asset management deVere Group, noted.
“We’ve seen this in action with the S&P 500 closing in correction territory on Tuesday, but Asian markets are mostly higher on Wednesday, as traders added stocks at lower prices following the recent sell-offs. European markets also edged up at the open and U.S. futures have nudged higher too,” he wrote.
But “Investors need to ask themselves ‘will stock markets be higher than this when I retire? Looking at financial market history, the answer is probably ‘yes’, if they have a decade or more ahead of them,” Green said.
Wednesday’s U.S. corporate earnings reporting schedule includes home improvement chain Lowe’s
LOW,
and TJ Maxx parent TJX Companies
TJX,
After the closing bell the focus will turn to online auctioneer EBay
EBAY,
and car rental giant Hertz Global
HTZ,
In Asia, the Hang Seng
HSI,
in Hong Kong gained 0.6% and China’s Shanghai Composite Index
SHCOMP,
rose 0.9%. Japanese markets were closed for a holiday.
