Weekly Economic Update: March 15th, 2022

Presented by Nicholas Wealth Management

March 15th, 2022

Weekly Market Update

In this week’s recap: Ukrainian War impacts the global economy.

The Week on Wall Street

Intensifying hostilities in Ukraine continued to unsettle markets, as investors grappled with the war’s impact on the global economies. 

The Dow Jones Industrial Average lost 1.99%, while the Standard & Poor’s 500 dropped 2.88%. The Nasdaq Composite index fell 3.53% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 0.90%.^1,2,3

Markets Remain Stressed

Markets spiraled last week as Russia escalated its attacks on Ukraine, the U.S. banned imports of Russian oil, and more companies announced the suspension of business in Russia. Eastern Europe has added complexity to the Fed’s plans for raising interest rates to manage accelerating inflation, which has been heightened by a sharp rise in energy and other commodity prices.

The stock market saw brief moments of respite. Stocks rallied Tuesday on a news report that Ukraine would promise not to pursue NATO membership, but lost momentum before the close. Stocks rallied on Wednesday as oil prices tumbled, but were unable to follow through on Thursday and then faded further into Friday’s close.

A Four-Decade High

Consumer prices rose 0.8% in February as energy and commodity prices pushed higher. This latest monthly report showed a year-over-year inflation rate of 7.9%, the highest level since January 1982. Excluding the more volatile food and energy prices, the 12-month increase was 6.4%, a slight bump from last month’s 6.0% year-over-year increase.⁴

Many economists hoped that inflation pressures would ease, but February’s inflation number suggested that the impact of sanctions and supply-chain disruptions due to the invasion of Ukraine may likely feed further price increases for the foreseeable future.

Tip of the Week

Radio

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Media

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What a 25-basis-point Fed rate hike won’t do: get Americans back to work, fix the supply chain disaster, and control inflation. David Nicholas joined David Asman on Fox Business on Tuesday, 3/15 to discuss why the Feds actions will hurt American Consumers.

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CITATIONS:

1. The Wall Street Journal, March 11, 2022
2. The Wall Street Journal, March 11, 2022
3. The Wall Street Journal, March 11, 2022
4. The Wall Street Journal, March 10, 2022