Dow dropped 168, decliners over advancers 5-4 & NAZ finished up 56. The MLP index gained 5+ to the 193s befitting from oil's big gain & the REIT index dropped 7+ to 451. Junk bond funds saw only minor fluctuations & Treasuries surged with strong demand, taking the yield on the 10 year Treasury down 14 basis points, finishing under 1.85%. Oil shot up 4 to the 95s & gold settled 18 higher at 1906 (more on both below)
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Russia's central bank has shut down the country's stock exchange for the week as the ruble plummets amid mounting sanctions imposed by other nations over Russian Pres Vladmir Putin's invasion of Ukraine. The Bank of Russia announced that the Moscow Exchange would not open some sections of the market for the day in light of the "current situation," before sending a 2nd alert saying trading would be entirely suspended until Mar 5. Russian-related exchange-traded funds took a hit. The decision comes as the central bank scrambles to try & mitigate steep, coordinated economic sanctions imposed by several other countries, including the US & as the ruble hit a new record low versus the $. The Bank of Russia also signaled it would resume buying gold on Mon & raised its key interest rate to 20%, up from 9.5%, in an effort to fight the depreciation of the ruble & higher inflation. NATO allies & other nations have taken action to inflict economic pain on Russia as Putin continues his bloody assault on Ukraine. Select Russian banks are set to be removed from the SWIFT intl banking network by the EU & the Bank of Russia has also been targeted directly with sanctions from the Biden administration. A senior White House official said today, "Our strategy is to make sure that the Russian economy goes backward as long as President Putin decides to go forward with his campaign."
Russia's central bank makes unprecedented move as war rages
The average US. price of a gallon of regular-grade gasoline spiked 10¢ over the past 2 weeks to $3.64 per gallon (3.8 liters). Industry analyst Trilby Lundberg of the Lundberg Survey said that the price jump came after a rise in crude oil costs amid global
supply concerns following Russia’s invasion of Ukraine. Lundberg said further increases are likely. The price at the pump is about a $ higher than it was a year ago. Nationwide,
the highest average price for regular-grade gas is in the San Francisco
Bay Area, at $4.86 per gallon. The lowest average is in Houston, at
$3.14 per gallon. According to the survey, the average price of diesel is $4.02 a gallon, up 12¢ over 2 weeks.
Average US gas price spikes to $3.64 and climbing
White House press secretary Jen Psaki said the US needs to decrease its reliance on foreign oil by switching over to renewable energy, not increasing domestic production. "We need to reduce our dependence on foreign oil, on oil in general, and we need to look at other ways of having energy in our country and others," Psaki added. "We've seen over the last week or so... a number of European countries are recognizing they need to reduce their own reliance on Russian oil." Her comments come as fears grow that energy prices could continue to rise amid Russia's ongoing war in Ukraine, with many NATO countries such as Germany dependent on Russian oil to fuel their countries. That dependence has also limited the intl response to Russia's invasion, with sanctions being specifically designed not to target Russian fuel exports amid fears such a move could send energy prices soaring in Europe. The comments also come after the Biden administration last week began delaying decisions on new oil & gas leases after a federal judge blocked the administration from using higher climate change cost estimates when regulating polluting industries. The ruling stems from Pres Biden's decision on his first day in office to restore the climate cost estimate to $51 per ton of carbon dioxide emissions, up from the $7 it was slashed to during the Trump administration.
Biden admin dismisses calls to increase oil production at home
Ukrainian & Russian officials wrapped up a critical round of talks today near the border with Belarus. Officials from both countries said the sides could hold more negotiations amid Moscow's invasion of Ukraine. Ukraine's armed forces continue to hold off Russian troops, defending & retaining control of key cities, & slowing Russia's advance on Kyiv. Meanwhile, the central bank of Russia more than doubled its key interest rate today, as the ruble plummeted after heavy sanctions were imposed on Moscow by the West. Pres Biden held a call with its allies today to discuss the ongoing armed conflict in Ukraine. Biden spoke from the Situation Room with European Commission Pres Ursula von der Leyen, European Council Pres Charles Michel, Pres Emmanuel Macron of France, Chancellor Olaf Scholz of Germany, Prime Minister Mario Draghi of Italy, NATO Secretary-General Jens Stoltenberg, Pres Andrzej Duda of Poland, Pres Klaus Iohannis of Romania, Prime Minister Boris Johnson of the UK, Prime Minister Justin Trudeau of Canada & Prime Minister Fumio Kishida of Japan. In a UK readout of the call, Johnson welcomed Germany's defense spending increase & transfer of military equipment to Ukraine. Johnson also called on allies to respond to the emerging humanitarian crisis on Ukraine's borders.
Russia and Ukraine say first talks have ended, Macron urges Putin to stop attack
Gold up nearly 6% in Feb, largest monthly rise since May. Gold futures shot higher today, with prices settling back above $1900 after the US & its allies added new sanctions against Russia over the weekend as a result of its invasion of Ukraine last week. Those sanctions include prohibiting any transactions with the Central Bank of the Russian Federation, as well as Russia's national wealth fund & the Russian Ministry of Finance. Apr gold rose $13 (0.7%) to settle at $1900 an ounce after trading as high as $1935. Prices based on the most-active contract, which finished down 0.6% last week, gained 5.8% for the month of Feb -- the largest monthly rise since May. Meanwhile, one market strategist said that gold values should be more elevated & speculated that Russia may be liquidating some gold reserves to garner cash against the barrage of financial sanctions it is facing. Russia's ruble marked an all-time low against the $, but that decline had moderated somewhat, down over 13% to 95.07 after trading at 119.25 per $ at its low. Trading has been described as thin & volatile. That decline came after Russia's central bank raised a key lending rate 20%.
Gold settles back above $1,900 as sanctions hit Russia, fueling a rush into ‘precious havens’
BERLIN - E.ON, Europe's largest operator of energy networks, rejected demands to shut down the Nord Stream 1 gas pipeline as part of sanctions against Russia for invading Ukraine. After the German gov put the Nord Stream 2 pipeline on hold last week, Polish Prime Minister Mateusz Morawiecki on Sat called for shutting down Nord Stream 1, which has transferred Russian gas to Germany since 2011. Nord Stream is a joint venture of Russia's Gazprom, Germany's oil & gas producer Wintershall DEA, PEG Infrastruktur E.ON, Dutch Gasunie & French Engie. E.ON, which holds a 15.5% stake in Nord Stream 1, said the project was "completely different from the ongoing discussions about the Nord Stream 2 line." "Nord Stream 1 is a permitted and fully operational gas import pipeline," a spokesperson for the company said, adding that the line's capacity was fully utilized in the past 2 years.
Germany's E.ON rejects halting Nord Stream 1 pipeline
Oil prices were up sharply today, with global benchmark Brent crude topping $100 a barrel, after the West imposed more sanctions on Russia, a key energy producer, due to its ongoing invasion of Ukraine. Also, a report said that the US & other major oil-consuming countries were weighing the release of 70M barrels of oil from emergency stockpiles in response to surging crude prices. West Texas Intermediate crude for Apr was up $3.26 (3.6%) at $94.85 a barrel after trading as high as $99.10 in earlier activity. Global benchmark Apr Brent crude was up $2.68 (2.7%) to $100.61 a barrel, after topping $105 at its session high. The contract expires at the end of the session. The more actively traded May contract was up $3.31 (3.5%) at $97.43 a barrel. Members of the Intl Energy Agency, a Paris-based group whose members include most industrialized nations, could agree as early by tomorrow to tap their national strategic oil reserves, a report said, citing European & Persian Gulf officials. A journal reported it would include 40M barrels from the US. Oil prices had jumped after the US, the EU & the UK over the weekend said they would block some Russian banks from the SWIFT messaging system, a move that makes it more difficult for countries to purchase Russian oil. The US Treasury today said it’s prohibiting any transactions with the Central Bank of the Russian Federation, as well as Russia's national wealth fund & the Russian Ministry of Finance. OPEC & its allies (OPEC+) are scheduled to meet Wed to make a decision on Apr oil production levels.
Another wild, volatile day in the stock market. And that means very volatile!! Expect more of the same tomorrow. Keep in mind that releasing oil from reserves is only a temporary fix. The Dow is down 1200 in Feb & 2450 YTD.Dow Jones Industrials
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