U.S. stocks rose, with the Standard & Poor’s 500 Index (CME:SPM14) rebounding from its biggest loss in a month, as comments from Russian President Vladimir Putin signaled the Ukraine crisis won’t immediately escalate.
The S&P 500 jumped 0.5 percent to 1,855.55 at 9:30 a.m. in New York.
“The market sold off on the macro concerns that started Friday afternoon,” Walter Todd, who oversees about $990 million as chief investment officer of Greenwood Capital Associates LLC in Greenwood, South Carolina, said by phone. “This is clearly a snapback or relief rally now on action overnight with Putin’s press conference.”
The S&P 500 fell 0.7% from a record yesterday, the most since Feb. 3, joining a global selloff in equities on concern that Russia’s military presence in Ukraine could lead to a larger conflict. Putin got parliamentary approval over the weekend to send troops into the country.
Stocks rallied today after Putin said in his first public remarks since the ouster of former Ukraine President Viktor Yanukovych last month that he’d only send soldiers to Ukraine in an extreme case.
The MSCI All-Country World Index increased 0.5%, rebounding from its biggest drop in a month. The Europe Stoxx 600 jumped 1.8% and Russia’s Micex Index climbed 5.3% after $55 billion was erased from the value of the country’s equities yesterday. The yen weakened against all of its 16 major peers and gold fell 1.3%.
Secretary of State John Kerry arrives today in Kiev as the U.S. and its European allies seek ways to increase economic and diplomatic pressure to deter Russian military escalation in Ukraine’s Crimea region.
European Union President Herman Van Rompuy yesterday called a March 6 emergency EU summit, where leaders may debate measures to punish Russia if it doesn’t back off.
“There’s quite a lot of noise right now,” Gunther Westen, who helps oversee about $35 billion as head of asset allocation and fund management at Meriten Investment Management GmbH in Dusseldorf, Germany, said by telephone. “On the geopolitical front, you have Ukraine in the limelight. This is certainly a threat, but market concerns tend to fade as long as the situation doesn’t get worse or as long as the economies are not heavily influenced.”
The S&P 500’s decline yesterday erased its gain for the year after the gauge rallied 4.3 percent in February to close at a record 1,859.45. Investors have been speculating that recent weakness in data from housing to jobs was caused by inclement weather and that the Federal Reserve will continue to support the economy.
U.S. equities completed a rebound last week from a selloff spurred by emerging-market turmoil that erased 5.8% between Jan. 15 and Feb. 3, the biggest retreat since June.
Stocks are set to enter the sixth year of a bull market that started March 9, 2009. Three rounds of stimulus have helped push the S&P 500 up 173% from a 12-year low.