Stocks are off to a mixed start on Wall Street Monday as gains for some big technology companies are offset by weakness in energy stocks as crude oil prices fall sharply.
NEW YORK (AP) — Stocks are off to a mixed start on Wall Street Monday as gains for some big technology companies are offset by weakness in energy stocks as crude oil prices fall sharply. The S&P 500 was moving between small gains and losses in the early going. The Dow Jones Industrial Average was off 0.4% and the tech-heavy Nasdaq added 0.8%. Crude oil prices sank about 7% as China started to lock down Shanghai, its largest city and its financial center, to conduct mass testing and control a growing outbreak of COVID-19. Bond yields eased back after shooting higher this month.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street was pointed toward gains before the market opened Monday, while global shares mostly rose and oil prices fell after Shanghai went into a nine-day semi-lockdown.
Futures for the Dow industrials and the S&P 500 each rose 0.2% in premarket trading.
Adding to concern over the economic impact from the pandemic, Shanghai went into a nine-day semi-lockdown. With China’s economic growth already slowing, the extreme measure could worsen unemployment, sap consumer demand and further complicate already snarled global supply chains.
Still, the Shanghai Composite index edged 0.1% higher to 3,214.50.
In early European trading, Britain’s FTSE 100 added 0.7%, Germany’s DAX jumped 2.1% and France’s CAC 40 added 1.8%.
Russian shares slumped as its stock market resumed trading of all companies Monday after a monthlong halt following the invasion of Ukraine.
The benchmark MOEX index slid 2.2% after the Moscow Exchange reopened for all of its several hundred listed companies, but with restrictions still in place to limit volatility. State-owned energy giant Gazprom fell 3.7%, while airline Aeroflot was up 3%.
The last full trading session in Moscow was on Feb. 25, a day after the index tumbled by a third after President Vladimir Putin ordered the invasion of Ukraine.
Last week the exchange tentatively reopened for two days with investors allowed to trade only 33 of the MOEX’s 50 companies.
Aside from the lingering concerns over the pandemic, the war in Ukraine and inflation are clouding the global outlook. The Federal Reserve’s moves to raise interest rates to counter surging prices are another worry in uncertain times.
The Japanese yen dipped to a seven-year low against the U.S. dollar after the central bank said it would buy 10-year Japanese government bonds at a fixed rate of 0.25% for three days starting Tuesday. By buying the bonds, the Bank of Japan is trying to keep interest rates under control at a time when rates are rising in the U.S. and elsewhere.
The BOJ has kept its own benchmark rate at an ultra-low minus 0.1% for years, trying to encourage borrowing and spending to help spur faster economic growth. Its determination to keep interest rates from rising is being strained by the yen’s weakness, which favors exporters but raises the costs of imports of crucial manufacturing materials and consumer goods and especially of oil and gas.
The dollar was trading at 124.18 yen late Monday, weakening from 122.07 yen late Friday. The euro cost $1.0962, down from $1.0989.
The trend is unlikely to reverse anytime soon, Stephen Innes of SPI Asset Management said in a commentary.
“There is no evidence yet that the BOJ is willing to push back against (Japanese yen) weakness due to rising import price pressures,” he said.
Japan’s benchmark Nikkei 225 slipped nearly 0.7% to finish at 27,943.89 on Monday, while Australia’s S&P/ASX 200 gained 0.1% to 7,412.40. South Korea’s Kospi inched down less than 0.1% to 2,729.56. Hong Kong’s Hang Seng surged 1.3% to 21,684.97.
Ukraine and Russia are due to hold talks early this week in Turkey. Ukraine’s President Volodymyr Zelenskyy said Sunday in a nightly national address that he hoped for “peace without delay” but would ensure his country’s sovereignty and territorial integrity.
The war is adding to worries over instability, energy prices and economic slowdowns in various nations.
Oil prices have been volatile since Russia’s war against Ukraine began in February. Russia is the second-biggest crude exporter. Energy prices were already high, but the conflict has raised concerns about a worsening supply crunch that could maker persistently rising inflation even worse.
The United Arab Emirates’ energy minister on an oil alliance with Russia, saying it’s an important member of the global OPEC+ energy alliance with its output of 10 million barrels of oil a day.
“And leaving the politics aside, that volume is needed today,” Suhail al-Mazrouei said. “Unless someone is willing to come and bring 10 million barrels, we don’t see that someone can substitute Russia.”