Economic news

Wall Street Extends Selloff on Ukraine Worries

  • U.S. and allies keep tougher measures against Russia in reserve
  • Lowe's rises after upbeat outlook
  • Indexes: Dow down 1.4%, S&P 500 down 1.8%, Nasdaq down 2.6%

NEW YORK, Feb 23 (Reuters) - Wall Street's major indexes ended sharply lower on Wednesday, extending their recent rout as Ukraine declared a state of emergency and the U.S. State Department said a Russian invasion of Ukraine remains potentially imminent.

The State Department added that Washington has not seen any indication of Russians backing away, while the White House said President Joe Biden has no intention of sending U.S. troops to fight in Ukraine.

Earlier, the West unveiled more sanctions against Russia over its move into eastern Ukraine, and Moscow began evacuating its Kyiv embassy. 

Nasdaq led the day's decline, falling more than 2%, while the information technology sector dropped 2.6% and was the biggest drag on the S&P 500.

"If anything (Russian) President Putin is digging his heels in despite the increased sanctions," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles. "That's really adding to elevated nervousness about further aggressive actions and what that will mean for commodities and inflation overall."

The Dow came within a hair's breadth of confirming it was in a correction on Wednesday, while the S&P 500 in the previous session confirmed it was in a correction when the index ended down more than 10% from its Jan. 3 closing record high.

A correction is confirmed when an index closes 10% or more below its record closing level.

The Nasdaq has tumbled almost 19% from its record-high close on Nov. 19, nearing a 20% decline that many investors view as the definition of a bear market.

The Dow Jones Industrial Average fell 464.85 points, or 1.38%, to 33,131.76, the S&P 500 lost 79.26 points, or 1.84%, to 4,225.5 and the Nasdaq Composite dropped 344.03 points, or 2.57%, to 13,037.49.

Investors also have been on edge about possible aggressive tightening by the Federal Reserve to combat inflation.

"There's been geopolitical risks and rhetoric that have given investors that much more to be worried about," said Liz Young, head of investment strategy at SoFi.

"What it's done is exacerbate the momentum that was already in place to the downside," she said. "What we were seeing already coming into this was clearly a compression in multiples across a number of different highly valued areas of the market."

A Reuters poll showed the S&P 500 index still rising by end-2022. 

In company news, shares of Lowe's Cos Inc ended slightly higher after the company raised full-year sales and profit forecasts. 

Declining issues outnumbered advancing ones on the New York Stock Exchange by a 2.92-to-1 ratio; on Nasdaq, a 3.14-to-1 ratio favored decliners.

The S&P 500 posted 2 new 52-week highs and 39 new lows; the Nasdaq Composite recorded 24 new highs and 550 new lows.

Volume on U.S. exchanges was 11.98 billion shares, compared with the roughly 12.3 billion average for the full session over the last 20 trading days.

Reporting by Caroline Valetkevitch in New York Additional reporting by Susan Mathew and Devik Jain in Bengaluru, Sinead Carew in New York and Noel Randewich in Oakland, Calif. Editing by Arun Koyyur and Matthew Lewis

Source: Reuters

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