Russia's Ministry of Defense said it had pulled back troops from the Ukrainian border, lifting U.S. and European stock markets after days of losses.
- Stocks in Europe and the U.S. are rising after Russia's Ministry of Defense said it pulled back troops from the Ukrainian border.
- Crude oil prices dropped from seven-year highs and the euro advanced against the dollar.
- Interest rates remain a concern for investors, as the yield on the 10-year Treasury stayed above 2%.
Crude oil prices dropped from seven-year highs, with West Texas Intermediate (WTI) crude down 3% to just below $93 a barrel. The yield on the 10-year Treasury note remains near 2%.
The S&P 500 had ended 0.4% lower yesterday, mostly recovering from a steep sell-off after the U.S. said it plans to close its embassy in Kyiv. The Dow fell half a percent, and the Nasdaq ended flat.
This morning, the Bureau of Labor Statistics reported its Producer Price Index (PPI) rose 1% in January, significantly above economists' expectations of a 0.5% increase. Wholesale inflation rose 9.7% year-over-year, also above estimates of 9.3%, after a 9.8% annual rise in December.
The price of Bitcoin is surging nearly 5%, now above $44,000, while the price of Ether is up over 7%, above $3,000. Most other major cryptocurrencies are trading higher as well.
Quick Hits: Today's Headlines
Tower Semiconductor Ltd. (TSEM) shares are surging over 40% in pre-market trading after Intel announced it will buy the firm for $5.4 billion. Tower makes computer chips for a wide range of products, from cars to medical and industrial equipment.
Federal investigators are reportedly looking into the business of block trading. Regulators are examining whether bankers might have tipped off hedge fund clients ahead of large sales of blocks of stocks.
Tesla (TSLA) CEO Elon Musk gave nearly $6 billion in Tesla stock to charity last year, according to an SEC filing. The filing didn’t name the recipient, but the donation came amid a series of stock sales by Musk to pay for taxes.
The U.S. Senate Banking Committee is expected to vote on Federal Reserve nominees Jerome Powell, Lael Brainard, Lisa Cook, Philip Jefferson, and Sarah Bloom Raskin. Powell has been serving as Fed “Chair Pro Tempore” as he awaits confirmation of his reappointment.
The Texas attorney general's office sued Meta's Facebook (FB), alleging that the social media giant violated state privacy protections, with now-discontinued facial recognition technology that collected the biometric data of millions of Texans without their consent.
Ford Motor (F) said it will continue idling some of its assembly plants this week because of the global semiconductor shortage. The U.S. automaker will idle production at its Ohio and Kansas City assembly plants after suspending or cutting production at eight plants in North America last week.
Microsoft (MSFT) will begin bringing employees back to the office at the end of this month. The company cited rising vaccination rates and falling hospitalizations in Washington state, where it is headquartered.
Mastercard (MA) reported it will be hiring 500 younger workers this year after announcing it will create a consulting arm that focuses on cryptocurrency.
The Big Story: Backing off Highs
Oil prices backed off seven-year highs amid reports Russia is pulling back some troops. Oil prices had surged to their highest levels in more than seven years yesterday, with light sweet crude moving close to $100 a barrel, a level it hasn’t hit since 2014.
Russia is the world’s third largest oil producer, exporting about 5 million barrels a day of crude, roughly 12% of the global oil trade. It also exports another 2.5 million of other petroleum products, about 10% of the global trade. About 60% of Russia’s oil exports go to Europe, and another 30% go to China.
Russia depends heavily on exports from its fossil fuels, making it unlikely it would cut exports in an act of retaliation. If there were a disruption, it would more likely be to Russia’s exports of natural gas, much of which flows through a pipeline network in Ukraine. Russia exports around 23 billion cubic feet of gas a day, about 25% of the global trade. About 85% of that natural gas goes to Europe.
The network transports about 4 billion cubic feet of natural gas each day, however it is currently operating at only 50% of its capacity. Natural gas prices recently hit records in Europe on the reduced flows from Russia.