US stocks rise at open; Moscow sees billions in losses – USA TODAY

Posted: Friday, March 21, 2014

U.S. stocks opened higher Friday and were looking to post gains in a volatile trading week even as Russian stocks tumbled after Washington announced additional sanctions on key members of President Vladimir Putin’s inner circle.

The Dow Jones industrial average was up 0.5% to 16,441 and the Standard & Poor’s 500 index gained 0.6% to 1,884. The Nasdq composite index rose 0.5% to 4,341.

UKRAINE CRISIS: Obama announces more sanctions against Russia

The Micex index dropped as much as 3% in Moscow before recovering a little on the day Russia formally annexed Crimea after Putin signed into law the incorporation, calling it a “remarkable event.” The Russian stock market has lost more 10% this month, wiping out billions in market capitalization.

“Today is but the opening act: we expect to soon sign the Agreement’s remaining parts, not least the economic provisions,” European Council President Herman Van Rompuy said Friday in a statement, referring to the EU’s freshly inked Association Agreement with Ukraine.

“It recognizes the aspirations of the people of Ukraine to live in a country governed by values, by democracy and the rule of law, where all citizens have a stake in national prosperity, ” he said.

Obama signed an executive order Thursday that gives the United States authority to impose sanctions on individuals as well as “key sectors of the Russian economy.” The new order gives the Treasury Department the ability to target individuals and institutions in Russia’s financial services, energy, metals and mining, defense and engineering sectors.

Two Russian banks including Bank Rossiya, the Russian lender which was put on the Treasury’s sanctions list, said Visa and MasterCard stopped providing services to them. U.S. officials described Russia’s 15th largest bank with $12 billion in assets as a “personal bank for senior officials of the Russian Federation.”

RUSSIAN ECONOMY: Putin to Russian billionaires: Pay up

Russia’s central bank sought to assure Friday that the blacklisting of Rossiya and its transactions by U.S. authorities “does not have a serious bearing on the lender’s financial stability.” However, it added that the government could “take necessary steps to support the lender and the interests of its depositors and creditors.”

President Putin joked about the officials and lawmakers hit by Thursday’s sanctions in a televised meeting and pledged to support the black-listed lender. He said in televised remarks that he sees no immediate need for further Russian retaliation. He even said sardonically that he would open an account in the targeted bank.

Elsewhere, Japanese markets were closed for a public holiday.Hong Kong’s Hang Seng index gained 1.2% to 21,437. The Shanghai composite index in mainland China advanced 2.7% to 2,048.

European benchmarks pushed higher. Britain’s FTSE 100 index added 0.3% and Germany’s DAX index added 0.5%.

In other developments, ratings firm Fitch raised its outlook on the U.S.’s AAA credit-ranking to stable from negative. Moody’s Investors Service and Standard & Poor’s raised their outlooks last year on the U.S. to stable from negative.

Fitch downgraded the outlook for Russia’s credit rating fearing an economic fall-out from the Crimean crisis.

Fitch said in a statement released on Friday that it has revised the outlook for Russia’s debt to reflect the potential impact of sanctions on Russia’s economy. On Thursday, S&P warned of a potential downgrade, too.

On Thursday, the Dow gained or 0.7% to 16,331.05 and the S&P 500 rose 0.6% to 1,872.01. The Nasdaq composite climbed 0.3% to 4,319.29.

THURSDAY: Stocks close higher as better data offsets rate fears

Also Thursday: The Conference Board index of leading indicators, a measure of U.S. economic health, showed a rise in February by the largest amount in three months, suggesting growth should bounce back following a harsh winter. Separately, U.S. jobless benefits rose to near pre-recession levels, suggesting stable job market in the world’s largest economy.

Benchmark U.S. crude for May delivery was up 54 cents at $99.49 a barrel in electronic trading on the New York Mercantile Exchange. The contract dropped 27 cents to settle Thursday at $98.90.

Contributing: Associated Press

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