DJIA: 33,892.60, down 166.15
S&P 500: 4,373.94, down 10.71
Nasdaq: 13,751.40, up 56.78
Stocks cap monthly losses; Yields slide

U.S. stocks fluctuated on Monday as Wall Street continued to monitor the Russia-Ukraine conflict. The volatile session capped a second straight monthly decline for the major averages–a losing streak not seen since October 2020. The Dow shed 166 points, notching its worst month since November (-3.5%). The S&P 500 slipped 0.2%, extending its February drop to 3.1%, while the Nasdaq Composite climbed 0.4%, paring its monthly decline to 3.4%.

Over the weekend, the U.S. and its allies announced more sanctions against Russia, including penalties aimed at undermining the country’s financial institutions. Moscow retaliated with countersanctions, while its central bank implemented capital controls and hiked its benchmark lending rate to 20% from 9.5% as its currency dropped as much as 30%. Meanwhile, officials from Russia and Ukraine reportedly concluded initial ceasefire talks, with a second round of discussions potentially being held in the coming days. Still, battles around key Ukrainian cities are persisting.

Amid the risk-off mood, Treasuries rallied, with the yield on the 10-year note falling 14 basis points (0.14%) to 1.83% and the two-year note yield dropping 13 basis points (0.13%) to 1.44%. On the data front the Chicago purchasing managers’ index fell more than expected in February to 56.3, its lowest level since August 2020. Separately, a measure of manufacturing activity in the Dallas Fed region improved more than forecasted to 14.0 this month from January’s 2.0 print.

Seven of 11 S&P 500 sectors finished in negative territory, with Real Estate and Financials leading laggards. Energy stocks outperformed with West Texas Intermediate crude climbing 4.7% to $95.86/barrel.

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