NEW YORK, March 30 (Reuters) – U.S. stocks fell on Wednesday, with the Dow and S&P 500 snapping four-session winning streaks, on waning signs of progress for peace talks between Ukraine and Russia against a backdrop of a hawkish Federal Reserve curbing economic growth. Russian forces bombarded the outskirts of Kyiv and a besieged city in northern Ukraine, a day after promising to scale down operations.

The S&P has rebounded more than 5% in March after starting the year with two straight monthly declines. Still, the benchmark index is on track for its first quarterly decline since the first quarter of 2020, when the COVID-19 pandemic in the United States was reaching full swing. Stock prices have reacted to headlines about negotiations to resolve Russia’s invasion of Ukraine. Prices for commodities such as oil and metals have surged since the invasion, intensifying already-high U.S. inflation.

“Ukraine is the controlling narrative for this market, if we are going to get a settlement and we get the potential from that settlement for lower energy prices, which is really the key, and then some sort of return to normalcy in terms of the world economy that is a real positive for the market,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.

“If not, we are going to continue to just go back and forth here as the market tries to digest who the winners and losers are because there are a lot of unintended consequences coming out of this war,” Meckler added.

The Dow Jones Industrial Average (.DJI) fell 65.38 points, or 0.19%, to 35,228.81, the S&P 500 (.SPX) lost 29.15 points, or 0.63%, to 4,602.45 and the Nasdaq Composite (.IXIC) dropped 177.36 points, or 1.21%, to 14,442.28.

As inflation intensifies, so does speculation the Federal Reserve may get more aggressive in raising interest rates, which could put a damper on economic growth. The S&P energy index (.SPNY) was the leading sector on the plus side with a gain of 1.17%. It is up nearly 40% this year, which would mark its strongest quarterly performance ever.

The sector is currently one of only three that are positive on the year and has far outpaced the next closest performer in utilities (.SPLRCU), which are up nearly 4% on the year but closed at a record high for a fourth straight session. Some investors have taken a defensive stance due to fears of excessive Fed tightening and recent signals in the bond market that often act as precursors to a recession. read more

Still, economic data continues to indicate a strong labor market. The ADP National Employment Report showed private payrolls rose by 455,000 jobs last month after advancing 486,000 in February. Investors will watch for Friday’s payrolls report.

Lululemon Athletica Inc (LULU.O) surged 9.58% after forecasting full-year profit and revenue above estimates, as demand for athletic wear remains strong. Volume on U.S. exchanges was 11.69 billion shares, compared with the 13.93 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 1.24-to-1 ratio; on Nasdaq, a 1.98-to-1 ratio favored decliners. The S&P 500 posted 44 new 52-week highs and 1 new low; the Nasdaq Composite recorded 51 new highs and 47 new lows.

Reporting by Chuck Mikolajczak; Editing by Will Dunham and David Gregorio

(Reuters) – S&P Global Ratings, a unit of financial information provider S&P Global Inc (SPGI.N), said on Monday it will withdraw ratings for all Russian entities before April 15.

The decision comes weeks after parent company S&P Global said it was suspending commercial operations in Russia, joining a global exodus of companies out of the country due to tightening economic sanctions over Moscow’s invasion of Ukraine.

The credit rating agency is doubling down on its corporate boycott of Russia after the European Union announced a ban on providing credit ratings to legal persons, entities or bodies established in Russia, S&P Global Ratings said.

Western sanctions have frozen much of Russia’s central bank’s $640 billion in assets, barred several banks from global payments system SWIFT and sent the rouble into free fall. Credit rating agencies Moody’s and Fitch also suspended commercial operations in Russia earlier this month.

Reporting by Niket Nishant in Bengaluru; Editing by Shounak Dasgupta

NEW YORK, March 6 (Reuters) – Oil prices soared to their highest since 2008 due to delays in the potential return of Iranian crude to global markets and as the United States and European allies consider banning imports of Russian oil.

Talks to revive Iran’s 2015 nuclear deal with world powers were mired in uncertainty on Sunday following Russia’s demands for a U.S. guarantee that the sanctions it faces over the Ukraine conflict will not hurt its trade with Tehran. China has also raised new demands, according to sources.

In response to Russia’s demands, U.S. Secretary of State Antony Blinken said on Sunday that the sanctions imposed on Russia over its Ukraine invasion have nothing to do with a potential nuclear deal with Iran. The United States and European allies, meanwhile, are exploring banning imports of Russian oil, Blinken said on Sunday, and the White House coordinated with key Congressional committees moving forward with their own ban.

Brent rose $11.67, or 9.9%, to $129.78 a barrel by 6:50 p.m. EST (2350 GMT), while U.S. West Texas Intermediate (WTI) crude rose $10.83, or 9.4%, to $126.51, putting both contracts on track for their highest daily percentage gains since May 2020.

In the first few minutes of trade on Sunday, both benchmarks rose to their highest since July 2008 with Brent at $139.13 a barrel and WTI at $130.50. Both contracts hit their highest in July 2008 with Brent at $147.50 a barrel and WTI at $147.27. U.S. gasoline and distillate futures followed the surge in crude prices in the first few minutes after the market opened on Sunday, rising to record highs.

“Iran was the only real bearish factor hanging over the market but if now the Iranian deal gets delayed, we could get to tank bottoms a lot quicker especially if Russian barrels remain off the market for long,” said Amrita Sen, co-founder of Energy Aspects, a think tank. Analysts from JP Morgan said this week oil could soar to $185 per barrel this year.

“The idea was not to sanction oil and gas because of their essential nature, but oil is getting sanctioned by private actors not wanting to pick it up or ports not wanting to receive it and the longer this goes on the more supply chains are going to buckle,” said Daniel Yergin, author and vice chairman of S&P Global ahead of the CERAWeek conference in Houston.

Russia exports around 7 million bpd of oil and refined products or 7% of global supply. Some volumes of Kazakhstan’s oil exports from Russian ports have also faced complications. Analysts at Bank of America said if most of Russia’s oil exports are cut off, there could be a 5 million barrel or larger shortfall, and that means oil prices could double from $100 to $200 a barrel.

Iran will take several months to restore oil flows even if it reaches a nuclear deal, analysts said. Eurasia Group said fresh Russian demands could disrupt nuclear talks although it still kept the odds of a deal at 70%.

“Russia may intend to use Iran as a route to bypass Western sanctions. A written guarantee allowing Russia to do so is probably well beyond the realm of what Washington can offer in the midst of a full-scale war in Ukraine,” said Eurasia’s Henry Rome.

Also supporting crude prices, the closure of Libya’s El Feel and Sharara oilfields resulted in the loss of 330,000 barrels per day (bpd), the National Oil Corporation (NOC) said on Sunday. Libya, an OPEC member, produced about 1.2 million bpd of crude in 2021, according to U.S. energy data.

In the United States, meanwhile, the average price of a gallon of gasoline hit $4.009 on Sunday, according to AAA, an automobile association, which is the highest since late July 2008. Consumers are paying 40 cents more than a week ago, and 57 cents more than a month ago.

AAA, which has data going back to 2000, said U.S. gasoline prices at the pump rose to a record $4.114 on July 17, 2008. Senior U.S. officials traveled to Venezuela on Saturday for talks with President Nicolas Maduro’s government, seeking to determine whether Caracas is prepared to distance itself from close ally Russia.

Additional reporting by Dmitry Zhdannikov in London; Editing by Raissa Kasolowsky, Lisa Shumaker, Daniel Wallis, Sam Holmes and Diane Craft

NEW YORK/LONDON, Feb 28 (Reuters) – The Russian ruble hit record lows on Monday while world stocks slid and oil prices jumped after the West ramped up sanctions against Moscow over its invasion of Ukraine, including blocking Russian banks from the SWIFT global payments system.

Russia’s central bank hiked its key interest rate to 20% from 9.5% and introduced some capital controls to bolster the ruble and fight inflation. Authorities ordered exporting companies to sell 80% of their foreign revenues as the ruble slid as much as 32% before recouping some losses.

The European arm of Sberbank (SBER.MM), Russia’s biggest lender, faces failure, the European Central Bank (ECB) said, an early sign of a looming economic crisis in Russia. The fallout from tougher sanctions also rippled across financial markets outside Russia, especially in Europe where the main German and French bourses fell more than 3% in early trade but later pared most of those losses.

European banks were hit hard, with those most exposed to Russia, including Austria’s Raiffeisen Bank (RBIV.VI), UniCredit (CRDI.MI) and Societe Generale (SOGN.PA), falling between 9.5% and 14%. The wider euro zone index (.SX7E) of 22 major banks lost 5.7%, but the pan-regional STOXX 600 stock index closed down a scant 0.09% as sentiment improved at its close.

European bank stocks slide as West ramps up Russia sanctions
European bank stocks slide as West ramps up Russia sanctions
However, talks on a ceasefire ended without a breakthrough and a member of the Ukrainian delegation said the discussions were difficult as the Russian side was biased, news that darkened the mood on Wall Street.

The Dow Jones Industrial Average (.DJI) closed down 0.49% and the S&P 500 (.SPX) lost 0.25%. The Nasdaq Composite (.IXIC) rebounded, adding 0.41%, as investors bet the Federal Reserve will be less aggressive hiking interest rates. MSCI’s all-country world equity index (.MIWD00000PUS) closed down 0.077%.

Markets are likely to remain choppy in the near term, analysts said. While valuations have fallen and some risks have been priced into the market, it’s not time to derisk, Solita Marcelli, chief investment office for the Americas at UBS Global Weather Management, told clients in a note.

“Investors trying to trade off geopolitical events can easily get whipsawed,” Marcelli said, noting that sell-offs based on geopolitical events have been brief in the past. Oil prices surged after Russian President Vladimir Putin on Sunday put nuclear-armed forces on high alert.

The ramp-up in tensions heightened fears that oil supplies from the world’s second-largest producer could be disrupted, sending Brent crude futures to settle up $3.06 at $100.99 a barrel. U.S. oil settled up 4.5% at $95.72 a barrel, after topping $100 last week, their highest since 2014.

Even if Western governments allow the purchase of oil and gas from Russia, markets need to digest the disruption to hedging contracts, insurance coverage and energy markets, said Christopher Smart, chief global strategist at Barings Investment Institute.

“If Russian entities are effectively blocked from exchanging their money into the world’s reserves currencies, will the Russian government allow the foreign debts to be paid?” he said.

Reporting by Herbert Lash, additional reporting by Dhara Ranasinghe and Elizabeth Howcroft in London, Kevin Buckland in Tokyo; Editing by Jason Neely, Hugh Lawson, Nick Zieminski and Jonathan Oatis