Every cloud has a silver lining. Right now, external factors have pressed the Wall Street Market right to a corner. The 7.5% inflation rate and Russia-Ukraine conflict are 2 factors that are making investors scratch their heads hard. The latter is the highest inflation that has been witnessed in US, since March 1982 while the former is worsening the current economy by clashing the oil market.
That’s why last Friday, all the major indexes trembled in a worrying speed completing a 2 consecutive days losing streaks. Dow Jones declined by 503.53 points (-1.43%) finishing at 34,738.06. S&P 500 lost 85 points (-1.9%) recording a final reading of 4,418.64. Nasdaq Composite was biggest loser of the day felling by 394.49 points (-2.78%) completing at 13 791.15 when the closing bell was rung.
Despite Joe Biden’s threats to Russia, the conflict has already affected the Wall Street Market and other sectors that contribute to US economy. On Friday UK and US governments advised their citizens living in Russia to relocate. It is a political decision but it had far reaching consequences on Friday trading sessions because the energy sector declined by 3.05% according to Pinchas Cohen of investing.com
Energy sector will be one of the direct victims, if Russia actualizes its threats. The price of energy wiil go up, most likely $100 per barrel. And that will happen for the first time since 2014. “I think if war breaks out between Russia and Ukraine, $100 a barrel will be almost assured,” Phil Flynn, market analyst at Price Futures Group shared those sentiments through Marketwatch.com.
As Fed is planning on how it will raise interests’ rates, optimistic investors are strategizing on how they will beat the rising inflation. In the recent past, Growth Stock, soar beyond the COVID-19 pandemic. Thus, even this time round they will still beat the inflation set back. And you too can join them if you identify companies that can grow earnings and increase income beyond the level of the exceeding inflation as narrated by investing.com market writer.
On Friday, University of Michigan released the US consumer sentiments index, one day after the release of “CPI” by Labour department. The report that was released by Michigan showed that consumer sentiment index declined to 61.7 in the beginning of February, which happened to be its bottom most level since Oct. 2011. Again, that massive fall was powered by the rising inflation.
Away from the interests that will be raised by Fed, Ukraine invasion and on-going inflation; company earnings will still influence the direction of stocks this week. Among the high profile companies that will be posting their quarterly’s are Shopify (NYSE:SHOP), Wal-Mart (NYSE:WMT), NVIDIA (NASDAQ: NVDA) Cisco (NASDAQ:CSCO) Roku (NASDAQ:ROKU), Roblox (NYSE:RBLX) AND Drafkings(NASDAQ:DKNG. So, some shares have the possibility of gaining.
