U.S. equity index futures are down more than 2.0% after Russia attacked Ukraine with explosions reported in multiple cities. The S&P 500 futures are down 101 points and trade 2.4% below fair value while the Nasdaq 100 futures trade 3.2% below fair value.
Stocks in Asia closed sharply lower while stocks in Europe are selling off with U.S. futures – Russia’s MOEX Index is down 34%, versus a 3.8% decline in the Europe Stoxx 600. Cryptocurrencies are also weak with bitcoin down 9% to approximately $35,000.
Money is flowing into safe-haven assets like the 10-yr Treasury note, which is yielding 11 basis points lower at 1.87%, as well as commodities. WTI crude futures are up 7.4% to $98.94/bbl. The 2-yr yield is down 12 basis points to 1.48%. The U.S. Dollar Index is up 1.0% to 97.11.
Russian President Putin issued a dire warning to anyone who tries to interfere with Russia’s plans while President Biden said the U.S. and allies will impose severe sanctions on Russia. Chinese state media blamed the U.S. and rejected the term “invasion,” according to CNBC .
Things are looking bleak, and investors are bracing for further downside, evidenced by the 19.5% spike in the CBOE Volatility Index to 37.06.
Today’s data might disappear into the background with all eyes on the Russia-Ukraine situation. Investors will receive weekly Initial Claims (Briefing.com consensus 240,000) and the second estimate for Q4 GDP (Briefing.com consensus 7.0%) at 8:30 a.m. ET, followed by New Home Sales for January (Briefing.com consensus 805,000) at 10:00 a.m. ET.
In U.S. Corporate news:
- Moderna (MRNA 133.50, -2.23): -1.6% despite beating top and bottom-line estimates and authorizing a new $3 billion share repurchase program.
- eBay (EBAY 49.73, -4.86): -8.9% after issuing downside Q1/FY22 guidance for EPS and revenue. The company also increased its quarterly dividend by 22% and expanded its share repurchase authorization by $4 billion.
- Five9 (FIVN 52.63, -4.90): -8.5% after guiding Q1 EPS below consensus, although the company did guide FY22 revenue above consensus and beat top and bottom-line estimates.
- Wayfair (W 107.00, -14.32): -11.8% after missing EPS estimates.
- South Jersey Industries (SJI 34.69, +11.21): +47.7% after agreeing to be acquired by Infrastructure Investments Fund for $36.00 per share for $36.00 per share in cash, reflecting an enterprise value of approximately $8.1 billion.
Reviewing overnight developments:
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Equity indices in the Asia-Pacific region ended Thursday on a lower note as sentiment weakened after Russia expanded its offensive in Ukraine. Japan’s Nikkei: -1.8% Hong Kong’s Hang Seng: -3.2% China’s Shanghai Composite: -1.7% India’s Sensex: -4.7% South Korea’s Kospi: -2.6% Australia’s ASX All Ordinaries: -3.0%.
- In economic data:
- South Korea’s January PPI 0.9% m/m (last 0.0%); 8.7% yr/yr (last 9.0%)
- Australia’s Q4 Private New Capital Expenditure 1.1% qtr/qtr (expected 2.6%; last -2.2%)
- Hong Kong’s January trade deficit HKD36.6 bln (last deficit of HKD32.8 bln). January Imports 9.6% m/m (last 19.3%) and Exports 18.4% m/m (last 24.8%)
- In news:
- Bank of Japan Governor Kuroda said that the central bank is not looking to modify its easy policy.
- China’s Housing Minister said that the country’s housing demand has transitioned to the improvement phase.
- The Bank of Korea left its repurchase rate at 1.25%, as expected.
- In economic data:
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Major European indices trade on a sharply lower note while oil trades higher after Russia expanded its offensive in Ukraine overnight. STOXX Europe 600: -3.8% Germany’s DAX: -5.1% U.K.'s FTSE 100: -3.1% France’s CAC 40: -4.5% Italy’s FTSE MIB: -5.0% Spain’s IBEX 35: -4.2%.
- In economic data:
- U.K.'s February CBI Distributive Trades Survey 14 (expected 25; last 28)
- France’s February Consumer Confidence 98 (expected 100; last 99)
- Italy’s December Industrial Sales -2.1% m/m (last 2.4%); 14.3% yr/yr (last 22.2%)
- Swiss Q4 employment level 5.239 mln (last 5.213 mln)
- In news:
- European Central Bank policymaker Makhlouf said that the ECB may decide when to end its asset purchases at the upcoming meeting, but flexibility has to be maintained in the face of geopolitical uncertainty.
- Bank of England Chief Economist Pill said that inflation remains uncomfortably high and must be brought down “in a measured way.”
- In economic data:
U.S. equity futures:
- S&P 500 Futures: -104 @ 4,121
- DJIA Futures: -780 @ 32,352
- Nasdaq 100 Futures: -430 @ 13,080
Overseas:
- Europe: DAX -5.1%, FTSE -3.1%, CAC -4.5%
- Asia: Nikkei -1.8%, Hang Seng -3.2%, Shanghai Composite -1.7%
Commodities:
- Crude Oil +7.12 @ 99.22
- Nat Gas +0.211 @ 4.809
- Gold +53.90 @ 1964.30
- Silver +0.842 @ 25.395
- Copper +0.0375 @ 4.5215