Nasdaq, S&P 500, Dow Jones rally on interim peace plan report

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The stock market rallied on Wednesday, albeit off session highs, after a report that Russia and Ukraine advanced on a tentative ceasefire plan.

The Nasdaq (COMP.IND.) +2.8%S&P (SP500) +1.6% and Dow (DJI) +1.1% win.

Eight of the 11 S&P sectors are higher, with consumer discretionary and financials leading. Utilities and energy are the lowest, with oil prices down slightly and silver moving into risk.

The Financial Times reported that the two sides are moving forward on a 15-point plan that would see Russia withdraw and Ukraine accept the neutrality and limits of its armed forces.

Ukrainian President Volodymyr Zelenskyy earlier called for more sanctions and a no-fly zone in a video address to Congress today.

Rates are stable ahead of what is expected to be a quarter point hike by the FOMC. The 10-year Treasury yield is stable at 2.16%.

“This is not the pandemic, where there was only one feasible political path,” said UBS chief economist Paul Donovan. “The Fed has two conflicting policy options with higher commodity prices.”

“If the Fed is worried about a cost-wage/price spiral, it will have to push growth below trend. Recession risks then increase significantly. If the Fed is worried about changes in demand slowing growth and increase unemployment, it will tighten more cautiously.”

On the data side, February retail sales rose a little less than expected.

“The headlines look disappointing, but the upward revisions – overall, non-auto sales were revised up 1.0%, with the control measure up +1.5% – were bigger than deviations from the February consensus forecast,” said Ian Shepherdson of Pantheon Macro. .

“Standing back from the noise, the first quarter is now on track for an annualized increase of almost 12% in the control measure – assuming there is no revision to the February figures. and flat m/m sales in March – a bigger increase than we previously expected,” he added. “In the third and fourth quarters of last year, control sales increased by 2.8% and 6.2%, respectively, so this is a clear acceleration. That probably can’t be sustained, but in the meantime, you should expect to see some upward revisions to Q1 GDP growth forecasts. .”

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