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Stock index futures point to a lower opening Monday as focus remains on the energy sector with the U.S. looking at a ban on Russian oil imports.
Nasdaq (NDX:IND) -1%, S&P (SPX) -0.9% and Dow (INDU) -0.9% futures are all down.
WTI crude is up 6% at around $122.50 per barrel after having topped $130 earlier.
“In Russia, the stock exchange is still suspended, and the ruble is still weakening,” UBS chief economist Paul Donovan said. ” Visa, Mastercard, and American Express have suspended operations. This means Russian cardholders cannot use the payment system outside Russia, and vice versa. As Russian cards can be used in Russia, this news does not directly encourage bank runs—but it does not build confidence in the Russian financial system.”
“The US signaled the possibility of banning Russian oil imports. Oil prices leapt, before calming a little. As armchair strategists doomscroll through Twitter, bear in mind 1) higher oil prices transfer wealth, making this negative for New York’s economy but positive for that of Texas; and 2) shocks cause people to adapt, both long term (alternative energy) and short term (more energy efficiency).”
Rates are higher. The 10-year Treasury yield is up 6 basis points to 1.78% and the 2-year is up 4 basis points to 1.53%.
“The continued pricing of central bank tightening combined with glob”al risk off drove the 2s10s treasury yield curve -13.9bps (-5.8bps Friday) flatter, finishing the week at +24.9bps, another low that is only matched by March 2020 levels,” Deutsche Bank’s Jim Reid said.