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Wall Street continues to collapse with the Dow plummeting 1,000 points

Carodka Finance.

A day in red was relived this Monday on Wall Street with the collapse of the Dow, meanwhile investors are concerned about the Federal Reserve's plans to increase interest rates that affect corporate profits. Tensions in Ukraine, earnings season and inflation have complicated the picture.

The Dow was down 1,000 points, or 3%, by midday. The S&P 500, the broadest measure of the US stock market, reported a 10% drop from its most recent high. Although the S&P 500 was trading 3.7% lower at midday, its index shows it to be the worst week since March 2020.

Wall Street tiene un desplome en el DOW de 1.000 puntos en picada.

The Nasdaq Composite, which saw upward corrections last week, was the biggest loser this morning at 4.5%. Every day of the past week, stocks performed terribly in the last hour of trading, which bodes ill for the day ahead, says TD Ameritrade Chief Marketing Strategist JJ Kinahan, as that negativity was seen this Monday.

Investors have a lot at stake for this week that has just begun.

This earnings season has passed the big tech companies including Microsoft, IBM, Intel and Apple based on their results for this week.

After the Federal Reserve meeting that will conclude with the policy statement, market expectations are that the Central Bank will keep interest rates close to zero for a little longer according to CME FedWatch. But for the next meeting, which will be in March, the expectations of a rate increase of a quarter of a percentage point are above 80%.

Expectations are only part of what is at stake. The Fed could also conclude that inflation has skyrocketed by the end of 2021 and raise rates further or even sooner.

Treasury yields, which track interest rate expectations, came in below last week's highs on Monday. The 10-year bond yielded 1.72% at noon after topping 1.8% last week for the first time since before the pandemic.

As the Federal Reserve tries to reduce inflation by normalizing pandemic-era policies, the US economy struggles with the omicron variant. US private production slowed in January, as the variant put pressure on its high and massive infections. To make matters worse, investors are looking at the tensions between Russia and Ukraine and the possible Russian invasion of Ukraine.

The withdrawal of the embassies of the United States and the United Kingdom from Ukraine does not exactly generate confidence that the situation will be resolved quickly. In fact, European stock markets are also down considerably.

Commodity markets are feeling pressure from rising war tensions in Europe and analysts believe oil prices could soar if the situation escalates. On Monday, however, US oil prices fell 3.3% or nearly $2.90 a barrel to $82.31 by midday.

Really, the economic situation for the world would be complicated in every way if the highly acclaimed Vladimir Putin, who is absolutely nothing to exemplary, invades Ukraine.

Is Vladimir Putin really an exemplary president or is he just a facade of a good leader?


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