Market Snapshot: Dow, S&P 500 rise for second straight day in choppy trade as oil rally relents

U.S. stock futures took a step back Thursday with little immediate sign that Russia will halt its invasion of Ukraine that has sent commodity prices spiking higher.

What’s happening

Futures on the Dow Jones Industrial Average

fell 27 points, or 0.1%, to 33822

Futures on the S&P 500

eased 0.2%, or 7 points, to 4375

Futures on the Nasdaq 100

slipped 0.3%, or 49 points, to 14190

On Wednesday, the Dow Jones Industrial Average

surged 596 points, or 1.8%, to 33891, the S&P 500

jumped 80 points, or 1.9%, to 4387 and the Nasdaq Composite

rose 1.6%, or 220 points, to 13752.

What’s driving markets

Federal Reserve Chair Jerome Powell has a second day of testimony in Congress on Thursday, after saying on Wednesday he would recommend a quarter-point rate hike in two weeks time, though he left the door open to more substantial increases in future months if inflation doesn’t subside.

“If the Fed hikes 25bp in March that will have no impact on inflation in the coming several months. So, the question is not whether the Fed rate hikes are controlling inflation, but whether the predetermined course of inflation will brake lower sooner enough to stop the Fed/Powell from taking a more aggressive step or steps later,” said Robert Brusca, chief economist at FAO Economics.

Michael Brown, senior market analyst at Caxton FX, called the jump a “bear-market squeeze” and said the S&P 500 will struggle to clear its 200-day moving average until things de-escalate between Russia and Ukraine.

Russian Foreign Minister Sergey Lavrov said his country is ready for peace talks but will continue to attack what he called Ukraine’s military infrastructure. The United Nations reported that the refugee count has now topped 1 million.

Oil futures

surged to the highest level since 2008, with demand falling for Russian-produced crude and the OPEC+ oil cartel opting on Wednesday to stick with its planned production increase.

MSCI and FTSE Russell both said they will remove Russian stocks from their indexes next week, as Moody’s and Fitch cut Russia’s sovereign credit rating to junk.

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