US stocks sold off, crude oil prices soar

 US stocks sold off, crude oil prices soar

Concern about the possibility of Russia attacking Ukraine caused the DJIA to lose 1.4%, while the price of WTI oil increased by nearly 4% yesterday.

Closing the session on February 11, the DJIA dropped more than 500 points, or 1.4%, when the administration of US President Joe Biden confirmed that it was ready to react if Russia attacked Ukraine. The S&P 500 and Nasdaq closed down 1.9% and 2.8%, respectively.

"The Russia-Ukraine tensions have cast a shadow on investor sentiment lately," said John Lynch, chief investment officer at Comerica Wealth Management in a report. However, recent developments show that this desire is increasingly remote."

This tension could drag the market into another correction - down 10% from the most recent peak, Lynch said, as "investors sell first and ask questions later".

For the whole week, 3 main indexes of Wall Street all went down, ending 2 consecutive weeks of gains. "Investors quickly pressed the sell button after reports that the US suspected Russia would attack Ukraine," said Edward Moya, senior market analyst at OANDA.

Concerns about Russia also spread to energy markets. The price of US crude oil WTI and Brent crude oil yesterday increased by nearly 4%, to $ 93 and $ 94 a barrel, respectively. Leading energy stocks, such as Baker Hughes, Occidental Petroleum and Phillips 66 yesterday also led the way in the market.

Analysts warn that conflict in Ukraine will threaten fuel supplies, in part due to sanctions. Russia is currently the second largest oil and gas producer in the world.

Analysts at JP Morgan this week warned oil prices could "easily" touch $120 a barrel if oil flows from Russia are disrupted. The price can even go up to 150 USD. The peak of Brent oil is 147.5 USD, set in July 2008.