The increasing chaos in Ukraine led to an increase in demand of haven assets, causing the US stocks to fall and reducing the weekly gain for the Standard & Poor’s 500 Index.

For example, Nordstrom Inc. (NYSE:JWN) declined by 4 percent while Monster Beverage Corp. (NASDAQ:MNST) witnessed an increase of 27 percent after Coca-Cola Co. (NASDAQ:COKE) signed an agreement to buy a stake in the company.

The S&P 500 (SPX) declined to 1,949.24 in New York. This happened at 1:25 p.m. when trading in S&P 500 stocks was almost 10 percent higher than the average for the month. This sudden downfall was not expected however, the Ukraine headlines have made the markets extremely sensitive and reactionary.

The S&P 500 had increased by 1.2 percent this week until this volatility of the market rapidly increased. The Chicago Board Options Exchange Volatility Index (VIX) normally shows a change opposite to the movement of S&P 500 but during the past week rose to 13.42.

Industrial production rose by 0.4 percent in July but the New York Fed Empire Manufacturing gauge moved in the opposite direction. Consumer confidence showed an unexpected and sudden decline to the lowest level.

On the other hand, wholesale prices witnessed a slower rate of increase primarily because the costs of fuel decreased by a large amount. Since there are lesser price pressures, the Fed has the opportunity to limit the purchases of monthly bonds.

However, the current economic stronghold of the country requires the Fed’s to implement the new rates as soon as possible. The U.S. central bank has agreed to continue with its monthly bond buys and the benchmark rate will be kept on the downside for a certain period of time even after the time for bond purchasing ends. Moreover, due to the weaknesses of the job market, the aim to bring inflation rate to 2 percent by 2018 seems quite difficult to achieve.

Earnings Scorecard

Approximately 19 S&P 500 companies, which include Home Depot Inc. (NYSE:HD) and Hewlett Packard Co. (NYSE:HPQ) will be releasing their earnings by the end of next week. Till now, almost 76 percent of these companies have crossed the estimates for earnings and nearly 65 percent have outperformed the estimates for sales.

Furthermore, stocks of 8 S&P companies sank 0.7 percent causing them to retreat today. Nordstrom, Inc. (NYSE:JWN) declined to $65.94 which is the lowest figure ever since May. It is reported that the luxury store chain missed its estimates because it reported Same Store Sales in the last four months.

Monster Beverage Corp (NASDAQ:MNST) soared to $91.16. Coca-Cola Co. (NASDAQ:COKE), on the other hand, bought a 17 percent stake in Monster Beverage Corp (NASDAQ:MNST) for nearly $2.15 billion. This opened up new opportunities for it in the energy-drink market.

Applied Materials Inc. (NASDAQ: AMAT) also witnessed a rise of nearly 4.6 percent. It is expected that this largest manufacturer of semiconductors and display equipment will hit new records primarily because it has been able to get its rivals’ orders of display machines.

 

 

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