Market Wrap: Stocks Rebound After Midday Tumble on Ukraine

Ukraine
AP/Sergei GritsA local resident passes by Ukrainian army APC in the city of Lutugino, eastern Ukraine on Friday. Fears of an escalation of the regional conflict buffeted stocks.
By MATTHEW CRAFT

NEW YORK -- Renewed fighting in Ukraine rattled markets on Friday. Reports that Ukrainian forces attacked Russian military vehicles that had crossed the border knocked stock markets down in the afternoon and sent traders into the safety of U.S. government bonds.

By the end of the day, the Standard & Poor's 500 index (^GPSC) was back to where it started as investors realized that a wider conflict wasn't underway.

John Canally, the chief economic strategist at LPL Financial, said it's understandable that traders dropped stocks in response to the flare-up. "Anyone who doesn't want to lose their job over the weekend sells first and asks questions later," he said.

Canally suspects the dispute between Russia and Ukraine will likely follow the pattern of recent months. Worrying headlines will be followed by soothing speeches. "We've been here before," he said.

The S&P 500 index fell 0.12 of a point to 1,955.06. It ended the week with a gain of 1.2 percent.

The Dow Jones industrial average (^DJI) fell 50.67, or 0.3 percent, to 16,662.91, while the Nasdaq composite (^IXIC) gained 11.93 points, or 0.3 percent, to 4,464.93

Mark Luschini, chief investment strategist at Janney Montgomery Scott, said that one reason world events seem to be driving trading recently is that there's a lack of anything else for traders to focus on. All but a handful of big companies have turned in second-quarter results already, and no major economic reports came out this week.

"For the moment, geopolitical events seem to hold the interest of the few people at their desks in mid-August," Luschini said.

The news crossed at mid-morning Eastern time that a column of Russian armored carriers had crossed into Ukraine late Thursday. Ukraine claimed that its artillery fire destroyed most of the vehicles, but Russia denied that it happened.

The reports upended major European markets, turning gains into losses. Germany's DAX dropped 1.4 percent, after climbing 1.1 percent earlier. France's CAC 40 lost 0.7 percent.

The yield on the 10-year Treasury note plunged as low as 2.30 percent, the lowest since June 2013, as traders seeking safety shifted money into U.S. government bonds. In late afternoon trading the yield climbed back to 2.34 percent, still down from 2.40 percent late Thursday.

Among companies in the news, Monster Beverage (MNST) soared 30 percent after Coca-Cola (KO) announced plans to pay $2 billion for a stake in the maker of caffeinated drinks. The deal comes as Coca-Cola's flagship soda business is flagging and "energy drinks" have become popular. Monster jumped $21.84 to $93.49.

Supervalu (SVU), a grocery store chain, said hackers gained access to its computer network for handling credit-card transactions. The company said it isn't sure yet if customers' account numbers and other information were stolen. Supervalu fell 28 cents, or 3 percent, to $9.31.

After the market closed Wednesday, Nordstrom (JWN) reported a slight drop in earnings as well as sales that fell just short of analysts' estimates. The department-store's stock slid $3.58, or 5 percent, to $65.11.

In commodities trading, Benchmark U.S. crude oil rose $1.77 to $97.35 a barrel.

The price of gold fell $9.50 to $1,306.20 an ounce. Silver fell four cents to close at $19.53 an ounce and copper edged up a penny to $3.10 a pound.

What to Watch Monday:
  • The National Association of Home Builders releases its housing market index for August at 10 a.m. Eastern time.
  • Urban Outfitters (URBN) reports quarterly earnings after financial markets close in New York.

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Iselin007

Ratings from the unknown poster? At least I know who my great grand fathers were!

And do please scare away more members then you can compete with that famous Sock Puppet who lost his job in the Dot com bubble.

August 16 2014 at 4:48 PM Report abuse -1 rate up rate down Reply
Iselin007

Inside note: If your going to watch Wednesday's " Who do you think you are", Kelsey Grammer was in my elementary grade class and then transfered to the other class because of the alphabetical order. Yes he was smart in Grammar school and he was an over achiever.
One of the stars from Welcome Back Carter lived with his Grand mother on my street but he died a few years ago.

August 16 2014 at 2:58 PM Report abuse -1 rate up rate down Reply
Iselin007

When AOL in New York changes their terms of service don't forget to take the difference out out of the ( Case Family Tree) because thanks to the attainer of Parker Wickham by New York the other side of the family is broke!

August 16 2014 at 2:33 PM Report abuse -2 rate up rate down Reply
Iselin007

After seeing what happened to my ancestors on LongIsland, it's no wonder I root for the Boston Red Sox. Ted Willams would of dropped a bar bell on some of these outsourcing munchkins.

August 16 2014 at 2:25 PM Report abuse -2 rate up rate down Reply
Iselin007

If people know this crap job market was going to happen to their descendants the Revolutionary war might have gone the other way!

August 16 2014 at 2:20 PM Report abuse -2 rate up rate down Reply
Iselin007

That 92 million 16 and over has not fallen yet so count on a blow out in the stock market because the consumer's are upset over the crap jobs and lousy recovery.

The poor are just waiting for an excuse to riot.

August 16 2014 at 2:10 PM Report abuse -2 rate up rate down Reply
thefacts22

The truth of the stock market are the billions pumped by the Feds,all the rest is speculation,,interest rates are in the floor,and that is hurting lots of old people;my question is...What will happen when our unsustainable obadebt starts going up in interest payments?

August 15 2014 at 7:20 PM Report abuse -2 rate up rate down Reply
3 replies to thefacts22's comment
socioeconomist1

Stocks down because of Ukraine
Stocks up as Ukraine tensions ease
Stocks down due to a Chinese man farting
Stocks up because I don't know but have to make up some bullspit for why.
Stocks down because the sun couldn't shine through the clouds
Stocks up because Warren Buffett saw his own shadow
Obama had breakfast and sent the stock markets up in early morning trading
Stocks rise as Rudolf the Red Nosed Reindeer humps the leg of Santa Claus, investors view it as good fortune on the horizon.
Stocks Markets are down on worries that the Cubs won't win the World Series.

Same old, Same old BS.... just tell it like it is.... Stock markets moved and the only people who know why are the billions of investors that decided to buy or sell today and depending on whether more people sold or more people bought is why the fking markets were up or down.

August 15 2014 at 7:04 PM Report abuse -3 rate up rate down Reply
1 reply to socioeconomist1's comment
Iselin007

The stock market has to look for blame to steer the responsibilty for the big mess off themselves while ignoring the plight of the helpless millions who can't even contribute to the SSI trust fund because of a lousy job market.

Try AOL jobs my firend did and he gets to work temp part time jobs and gets food stamps because there are no good jobs available! Thanks!

August 16 2014 at 2:44 PM Report abuse -2 rate up rate down Reply