Futures slide as West ratchets up sanctions against Russia

Flags are seen outside the New York Stock Exchange (NYSE) in New York City, where markets roiled after Russia continues to attack Ukraine, in New York, U.S., February 24, 2022. REUTERS/Caitlin Ochs

February 28, 2022

(Reuters) – U.S. stock index futures slid more than 1% on Monday as investors assessed the fallout from a new set of sanctions imposed by the Western countries on Russia over its invasion of Ukraine.

World stocks slid, oil prices jumped and Russia’s rouble tanked to record lows after the Western allies blocked Russian banks off the SWIFT financial network, while limiting Moscow’s ability to deploy its $630 billion foreign reserves. [GLOB/MKTS]

Worsening the mood, Russian President Vladimir Putin put nuclear-armed forces on high alert on Sunday.

Defense stocks L3Harris Technologies, Raytheon Technologies, Lockheed Martin Corp, General Dynamics Corp and Northrop Grumman jumped between 4.5% and 6.6% in premarket trading following news that Germany would increase its military spending.

Weapons makers outperformed the S&P 500 index last week, with a 3.4% gain for the S&P 500 Aerospace & Defense sub-index, compared with a 0.8% rise in the benchmark index.

Energy stocks were mixed, while Citigroup and Microsoft Corp slipped 2.6% and 1.4%, respectively, to lead losses among big banks and mega-cap growth companies.

At 06:06 a.m. ET, Dow e-minis were down 373 points, or 1.1%, S&P 500 e-minis were down 56 points, or 1.28%, and Nasdaq 100 e-minis were down 180.75 points, or 1.27%.

The CBOE volatility index, also known as Wall Street’s fear gauge, was last trading at 32.95, its highest level since Feb. 24.

(Reporting by Devik Jain in Bengaluru; Editing by Anil D’Silva)

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