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(Reuters) – U.S. stock index futures fell on Tuesday as fears of a war in Europe deepened amid escalating Russia-Ukraine tensions and threats of sanctions, although energy stocks soared on oil prices hitting their highest since 2014.
Russian President Vladimir Putin recognized two breakaway regions in eastern Ukraine and ordered troops to those regions, inviting threats of fresh Western sanctions.
Germany halted the Nord Stream 2 gas pipeline project designed to bring Russian gas to the country and Britain slapped sanctions on five Russian banks and three men close to Putin.
The European commission and the United States were set to announce more sanctions later in the day.
Megacap growth names such as Amazon.com Inc (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT), Meta Platforms Inc and Tesla (NASDAQ:TSLA) Inc lost between 1% and 2.5% in premarket trading.
As investors flocked to the safety of bonds, U.S. Treasury yields tumbled. Shares of big banks including Bank of America Corp (NYSE:BAC), Citigroup Inc (NYSE:C) and Goldman Sachs Group Inc (NYSE:GS) slipped about 0.5% each. [US/]
“The fear factor remains elevated and until we get some sort of a clearer picture of what Putin may or may not do, the market is just going to stay in a state of confusion and volatile,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
Oil stocks bucked the gloom, tracking crude prices that surged to near seven-year highs as a potential conflict with Russia could tighten supplies. [O/R]
Exxon Mobil Corp (NYSE:XOM) rose 1.8%, while Chevron Corp (NYSE:CVX) added 1.6%.
“With the price of oil surging, the other question is how is the (Federal Reserve) going to deal with this?” Cardillo said.
At 8:16 a.m. ET, Dow e-minis were down 105 points, or 0.31%, S&P 500 e-minis were down 10.25 points, or 0.24%, and Nasdaq 100 e-minis were down 84.5 points, or 0.6%.
All three indexes marked their second straight week in the red on Friday as fears about a Russian invasion of Ukraine and uncertainty around the Federal Reserve’s policy tightening plan roiled markets.
The CBOE volatility index, also known as Wall Street’s fear gauge, was last up 29.32, well above its long-term average of 20.
In earnings, Macy’s Inc (NYSE:M) jumped 7.2% after topping expectations for comparable sales in the crucial holiday quarter, benefiting from its strategy to stock up in advance.
SoFi Technologies Inc slipped 2.8% after the fintech company agreed to buy digital banking platform Technisys in $1.1 billion deal .
Shares of Digital World Acquisition Corp, the blank-check company behind former U.S. President Donald Trump’s new social media venture, Truth Social, surged nearly 30% as the app climbed the charts after its debut on Apple’s App Store.
Investors will also be looking for flash reading on Markit’s February PMI data due at 09:45 a.m. ET and consumer confidence data for the month due shortly after.