By Swann Collins, investor, writer and consultant in international affairs. Eurasia Business News – March 4, 2022

Dow Jones Stock Exchange, Manhattan, New York City – Photo credit : Swann Collins.

The war in Europe continues to haunt people’s minds. Despite very solid monthly employment figures in the United States, Wall Street started to retreat at the beginning of the session, swept away by the fall of the European markets. The Dow is currently down 1.47% to 33,297 pts, the S&P 500 is down 1.60% to 4,294 pts while the Nasdaq is stumbling 1.85% to 13,288 pts.

Accross the Atlantic, stock markets are also shaken. French stock market index CAC40 lost tonight nearly 5% in closing (-4.97%), back to 6,061 points, the lowest in a year. 

Concerns about the situation in Ukraine have risen a notch after the Russian army attacked the Zaporizhzhia nuclear power plant, where a fire now under control broke out on the night of Thursday to Friday.

US Secretary of State Antony Blinken said this morning that NATO does not want a conflict with Russia but “will defend the territory of its members in the event of a Russian attack“: “our alliance is defensive. We don’t want conflict… But if the conflict imposes itself on us, we are ready and we will defend every inch of NATO territory.” All options remain on the table for possible new sanctions against Russia for its invasion of Ukraine, said the European Union’s High Representative for Foreign Affairs, Josep Borrell.

However, investors and industry professionnals are worried by the rising commodities prices, as Western sanctions against Russian banks and oligarchs jeopardized the supply chains of gas, oil, aluminium, titanium and rare metals like lithium and palladium. Gold prices have registered strong gains over the past two weeks (see below).

Oil prices are jumping again even if they are moving a notch lower than their peak on Thursday. The barrel of US light crude (April futures) climbs 5% to $ 113 on the Nymex while the barrel of Brent from the North Sea (May futures) gains 4% to $ 114 after flirting with $ 120 yesterday.

If the monthly employment report in the United States is not perfect, it looks very much like it. Total nonfarm payroll employment rose by 678,000 in February, and the unemployment rate edged down to 3.8 percent, the U.S. Bureau of Labor Statistics reported on February 22. Job growth was widespread, led by gains in leisure and hospitality, professional and business services, health care, and construction.

This creation of non-agricultural jobs at 678,000 came out against a consensus of 423,000. The creation of jobs in the previous two months in the US has also been revised upwards. Job creation in the private sector reached 654,000 in February, against 378,000 expected. Manufacturing employment generated 36,000 jobs. These figures show the resilience of the US economy, in spite of high annual inflation (+7.5%).

Read also : How to invest in gold

Gold prices have been surging since January, amid geopolitical tensions and inflation worries in Europe and the United States. On March 4, gold prices hit $ 1,964.40 per troy ounce at the closure of London marketplace today. The yellow metal has always been a great hedge against inflation because it rises in price when the cost of living standards rises. 

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