Major U.S. benchmarks ended sharply lower on Wednesday, extending their recent losses as warning from U.S. officials that Russia could attack Ukraine anytime once again raised worries among investors. This coupled with worries of surging inflation and rising interest rates further took a toll on stocks. All the three major indexes ended in negative territory, with the Dow narrowly escaping from entering correction territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) slid 1.4% or 464.85 points to finish at 33,131.76 points, narrowly escaping from slipping into correction. The blue-chip index would have entered correction territory had it finished below 33,119.69 points, which would have marked a decline of 10% from its recent record high attained on Jan 4.
The S&P 500 lost 1.6% or 79.26 points to close at 4,225.50 points, slipping deeper into correction. The index has now declined more than 12% from its record close on Jan 3. Consumer discretionary and tech stocks were the worst performers.
The Consumer Discretionary Select Sector SPDR (XLY) declined 3.3%, while the Technology Select Sector SPDR (XLK) lost 2.5%. Ten of the 11 sectors of the benchmark index ended in negative territory.
The tech-heavy Nasdaq declined 2.6% or 344.03 points, to end at 13,037.49 points. If the index slips to less than 12,845.95 points, it will technically enter correction territory.
Shares of Microsoft Corporation
MSFT
and Apple, Inc.
AAPL
each declined 2.6%. Apple has a Zacks Rank #1 (Strong Buy). You can see
the complete list of today’s Zacks #1 Rank stocks here
.
The fear-gauge CBOE Volatility Index (VIX) was up 7.67% to 31.02. A total of 11.98 billion shares were traded on Wednesday, higher than the last 20-session average of 12.3 billion. Decliners outnumbered advancers on the NYSE by a 2.82-to-1 ratio. On Nasdaq, a 3.14-to-1 ratio favored declining issues.
Russia-Ukraine Crisis Continue to Impact Markets
Ongoing tensions between Russia and Ukraine have been keeping investors on the edge over the past few days. This has seen stocks taking a toll over the past couple of weeks. Tensions further escalated after U.S. officials on Wednesday said that Russia could invade Ukraine any time after Putin on Tuesday ordered Russian troops to move into two breakout regions of the country.
According to U.S. officials, Russia has accumulated between 150,000 to 200,000 troops along Ukraine’s borders. Meanwhile, Ukraine warned its citizens against traveling to Russia, further escalating tensions.
These, coupled with growing worries of surging inflations and anticipation of an aggressive monetary policy to be adopted by the Fed when it decides to go for rate hikes, added to the anxieties of investors, leading to huge selloff.
No economic data was released on Wednesday.
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