Dow dropped 65, decliners over advancers 3-2 & NAZ retreated 177. The MLP index was steady at 210 & the REIT index fell 4+ to the 485s. Junk bonds fund fluctuated & Treasuries continued to be purchased. Oil recovered 3+ to the 107s & gold advanced 19 to 1937 (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)
A majority of investors believe the biggest threat facing the markets right now is a policy error by the Federal Reserve as the central bank wrestles with taming decades-high inflation, according to the new CNBC Delivering Alpha investor survey. About 400 chief investment officers, equity strategists, portfolio managers & CNBC contributors who manage money about where they stood on the markets for the rest of 2022. The survey was conducted this week. 46% of the survey respondents said a Fed misstep could have the potential to derail the bull market, while 33% said surging US inflation poses a major threat. 11% listed further aggression from Russia after its invasion of Ukraine as the biggest threat to the markets. Earlier this month, the Fed approved a 0.25 percentage point rate hike, the first increase since Dec 2018. The central bank also signaled that it will be raise rates 10 times — in less than 2 years — & cut what likely will be Ts off the balance sheet. Fed Chair Jerome Powell recently vowed tough action on soaring prices, indicating he's open to rate hikes more than the traditional 25 basis points. Many notable investors are skeptical that the central bank will be able to engineer a soft landing even with a stronger economy. As for their market outlook, most investors (58%) see flat returns for the S&P 500 in 2022, while 36% believe the equity benchmark could rise about 8% to end the year above the 5000 level. Only 6% sees a correction before the year-end to take the S&P 500 below 4K.
Investors believe the biggest threat to the markets now is a Fed misstep, CNBC survey shows
The US included 100 killer drones in a colossal weapons package for Ukraine that Pres Biden approved earlier this month, US officials confirmed Wed. Celeste Wallander, assistant secretary of Defense for intl security affairs, told lawmakers that Kyiv asked for the weapons, which are dubbed “kamikaze drones,” as it fights off a Russian invasion. “We have committed 100 Switchblade tactical unmanned aerial systems to be delivered in the most recent package of presidential drawdown,” Wallander added in testimony before the House Armed Services Committee. “We’ve heard the Ukrainians and we take that request very seriously,” she continued. Pentagon spokesman John Kirby said last week that the drones would arrive in Ukraine soon, but declined to elaborate further. The decision to equip Ukraine with killer drones, dubbed Switchblade, follows Ukrainian Pres Volodymyr Zelenskyy's request to US lawmakers for additional military equipment. Deploying Switchblades to the fight in Ukraine could be the most significant use of the weapons in combat, as it is not clear how often the US military has used the killer drones on the battlefield.
U.S. sends 100 killer drones called Switchblades to Ukraine
US consumer confidence edged up in Mar, suggesting solid job growth offset Americans' concerns over decades-high inflation that poses a risk to spending & growth. The Conference Board's index increased to 107.2 from a downwardly revised 105.7 reading in Feb, which was the lowest in a year. The called for a reading of 107. Even though confidence edged up, Americans are facing the highest inflation since 1982, which is outpacing wage gains & being fanned further by the war in Ukraine. That's already causing some to limit their purchases of certain goods or services, & a slowdown in consumption would pose a risk to economic growth. Steady labor market gains have pushed employment back to pre-pandemic levels in some sectors, buoying US households. The share of consumers who said jobs were “plentiful” increased to a record high 57.2%. A separate report Tuesday showed US job openings remained near a record in Feb. Consumers were also mixed about their short-term financial prospects. The share who expect their incomes to rise in the next 6 months increased, but those who see their pay dropping also rose. A gauge of current conditions rose by the most since Jun to 153, suggesting consumers had a more upbeat assessment of business conditions & the labor market. The Conference Board's expectations index -- which reflects consumers' 6-month outlook -- declined to 76.6, the lowest since 2014. Concerns over inflation intensified in Mar. Consumers expect prices to rise 7.9% in the next year, an all-time high.
U.S. Consumer Confidence Unexpectedly Rises Despite
Gold futures finished highe, posting their first gain in 4 sessions in cautious trading as Russia shelled areas near the Ukraine capital of Kyiv despite an earlier pledge to scale back military options. Gold for Jun, the most active contract, rose $21 (1.1%) to settle at $1939 an ounce after losing 1.4% yesterday. Gold came under pressure yesterday after the resumption of talks between Russian & Ukraine negotiators. Although the talks produced no breakthroughs, both sides described the talks as constructive & Russia's military said it would scale back military operations near Kyiv & the northern Ukraine city of Chernihiv. But optimism soon gave way to skepticism about progress toward a ceasefire. Kremlin spokesman Dmitry Peskov said that Russia hadn't observed anything “really promising” in Ukraine proposals presented in yesterday's talks. Ukrainian Pres Volodymyr Zelensky & US officials, meanwhile, cast doubt on whether any pledge to pull Russian troops back amounted to a shift. Gold pared some gains after the ADP National Employment Report showed US private payrolls rose by 455K in Mar, compared with a gain of 450K forecasted. Gov data also showed that corp profits rose in Q4 & hit a record high. Adjusted pretax profits rose 0.7% to an annualized $2.94T in Q4-2021, versus in Q3.
Gold posts first gain in 4 sessions with traders wary of Russia’s pledge to cut military operations
Oil futures ended higher, as skepticism emerged over progress made a day earlier in negotiations with Russia to bring an end to the war in Ukraine, renewing worries about crude supplies in region. Prices continued higher after US gov data showed a weekly decline in crude inventories & a climb in stocks of gasoline & distillates. West Texas Intermediate crude for May rose $3.58 (3.4%) to settle at $107.82 a barrel after posting a loss of 1.6% yesterday. May Brent crude, the global benchmark, rose $3.22 (2.9%) to $113.45 a barrel following a 2% loss a day earlier. Oil prices clawed back from yesterday's losses & then some. Yesterday's decline came as hopes over signs of progress between Russian & Ukraine negotiators drove investors out of the commodity. Russia's Deputy Defense Minister Alexander Fomin reportedly said his country would decrease military activity in the direction of Kyiv & Chernihiv. But Kremlin spokesman Dmitry Peskov was reported as saying today that Russia hadn't noticed anything “really promising” in those Ukraine proposals yesterday. Ukrainian Pres Volodymyr Zelensky and US officials also cast doubt on whether any pledge to pull Russian troops back amounted to a shift. Pentagon spokesman John Kirby said the US had detected a small number of Russian ground forces backing away from Kyiv, but it looked like forces were just being repositioned. In a Jul meeting last year, OPEC+ said that starting May 1, 2022, baseline output for the group would see a modest increase for some members, but the group as whole has been unable to meet their full production quotas.
Oil prices end higher as skeptical views emerge over progress between Russia-Ukraine talks
Markets drifted lower as investors eyed developments on Russia-Ukraine discussions & assessed mixed data on the US economy. The Volatility Index (VIX) held near 20, its lowest level in more than 2 months. So far Dow is up 1300 in Mar but down 1100 YTD.
Dow Jones Industrials
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