The concerns outside the United States have crushed signs of progress in the United States. After five weeks, the S&P 500 hits a new low – shooting stocks to their lowest close since early February. Meanwhile, across the ocean from Wall Street, Ukraine and Russia are still in the thick of a crisis. With Russia on the border “ready to invade,” the threat of war is rising for Ukraine, as per its acting president. In sign of support for NATO allies, U.S. F-16 jets landed in Poland only hours later.
So far this year, Russia has kissed $50 billion in capital goodbye, according to Goldman Sachs (GS). By the end of the year – that will snowball into $130 billion (which is double the outflow of last year). The possibility of war is not the only concern – China’s economy is taking a turn for the worst – with a sharp slowdown over the first two months of the year.
Though investors fear what the downfall will mean for the global economy, the U.S. economy is looking brighter. For the first time in three months, retail sales rose – budding slightly of ahead analysts’ forecasts. This report also signals a very good sign after the harsh winter. What’s better, the unemployment lines are shortening! Last week, weekly job claims hit a new three-month low.
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Meanwhile, Stanley Fischer, Federal Reserve Vice Chairman nominee shared a few words with lawmakers on the Fed policy. He confirmed that he backed the policy and it’s ability to strengthen the economy – also vouching that it isn’t out of touch with the realities of Main Street.
Stanley Fischer says, “Anybody who has studied, and particularly studies this crisis, knows the cost of unemployment and understands slow growth is not an abstraction. Slow growth is people not finding jobs. Slow growth is problems for families and meeting their, even their food bill. And if one does not understand that, one cannot seriously think of being a policy maker.”
Elsewhere, shipping costs are eating away at Amazon.com’s profits. Therefore, it’s been forced to add a price hike with its annual membership, Prime – the first hike seen since it launched nine years ago. In exchange for free shipping, the membership jumped a whole $20 – equaling a $99 annual price. Fortunately, investors support the change! It’s shares are skyrocketing, even in a down market.
It seems that a downmarket has crept overseas as well – European stocks fell to five-weeks lows, too. Maybe everyone has the same concerns about Ukraine and China.