Dow ends 350 points higher as Biden touts NATO response to Russia-Ukraine war, Fed speakers

• The Dow Jones Industrial Average
  DJIA,
  +0.44%
  rose 349.44 points, or 1%, ending at 34,707.94.

• The S&P 500
  SPX,
  +0.51%
  gained 63.92 points, or 1.4%, closing at 4,520.16.

• The Nasdaq Composite
  COMP,
  -0.16%
  climbed 269.23 points, or 1.9%, finishing at 14,191.84.

On Wednesday, the Dow fell 449 points, or 1.3%, while the S&P 500 declined 1.2% and the Nasdaq Composite dropped 1.3%.

What drove markets

U.S. stocks closed near session highs Thursday as President Joe Biden wrapped up a series of gatherings with allies and world leaders in Brussels a month after Russian leader Vladimir Putin’s invaded Ukraine.

The Biden administration rolled out more sanctions against Russia, with the White House saying the U.S. now has sanctioned more than 600 Russian targets. Biden, in a news conference in Brussels, said the new sanctions will “cripple Putin’s economy,” while promising more military aid and $1 billion in humanitarian assistance for Ukraine.

“Until we see a cessation of hostilities between Russia and Ukraine, it is prudent for investors to raise cash and reduce exposure to stocks,” said Richard Saperstein, chief investment officer at Treasury Partners, in emailed comments. “While the stock market is attempting to recover from its correction, markets are fundamentally riskier and more uncertain than before Russia’s invasion of Ukraine.”

Investors also heard Thursday from several Fed officials on inflation and the central banking’s likely response. Minneapolis Fed President Neel Kashkari said he sees seven 25 basis point interest rate hikes as likely this year, but warned “there’s a danger of overdoing it,” while speaking at a business conference.

Chicago Fed President Charles Evans pointed to the same pace of hikes for 2022 as likely, with three more next year, which would bring the Fed fund’s rate to a range of 2.75% – 3%. Federal Reserve Gov. Christopher Waller told a housing conference he was watching the “red-hot” market to help gauge the appropriate monetary policy response.

Fed Chairman Jerome Powell earlier this week left the door open to rate increases larger than the usual 25 basis point increment.

“This very hawkish talk has not derailed the market rallying, which started about a week ago,” said Jimmy Chang, chief investment officer at Rockefeller Global Family Office, by phone.

“It has been a surprise that equities have held up so well, in the face of a more hawkish Fed and rapidly rising bond yields,” Chang said, adding that the more resilient equities end up being, the more emboldened the Fed likely will be to purse an more aggressive path to tighter financial conditions.

Chang also said he thinks there’s not “much additional upside” in U.S. stocks at current multiples, but expects trade to remain volatile until there’s more clarity from the next round of corporate earnings.

Other central banks also have geared up to tighten financial conditions. Mexican President Andrés Manuel López Obrador on Thursday said monetary policy makers voted to raise a key interest rate by half a percentage point to 6.5%.

U.S. economic data showed first-time jobless benefit claims fell 28,000 to 187,000 last week, the lowest since 1969. U.S. durable-goods orders fell 2.2% in February, coming in below forecasts.

The S&P Global U.S. services flash purchasing managers index for March rose to 58.9 from 56.5 a month earlier, while the manufacturing flash PMI rose to 58.5 from 57.3. A reading of more than 50 indicates expanding activity.

In Europe, the MOEX Russia Index rose more than 4% after Moscow Exchange resumed trading after nearly a month with a shortened four-hour session in 33 out of 50 stocks listed on the benchmark. However, foreign shareholders are unable to sell shares, a restriction Russia imposed to counter Western sanctions against its financial system and the weakening ruble.

U.S. crude oil prices
CLK22,
+0.25%
finished 2.3% lower Thursday at $112.34 a barrel, after no new oil sanctions against Russia emerged from the gathering of world leaders. While the U.S. and the U.K. are boycotting Russian oil, other nations are still buying Russian commodities, notably Europe for its natural-gas needs.

Which companies were in focus?

• Shares of Uber Technologies Inc. 
  UBER,
  -1.84%
  rose 5% after The Wall Street Journal reported that the company has struck a deal to list all New York City taxis on its app. 

• KB Home
  KBH,
  -2.01%
  shares fell 4.6% after executives said that issues with supplies and hiring enough workers harmed the company’s ability to complete construction of homes early in 2022, and financial results missed expectations in a Wednesday report.

• Olive Garden parent Darden Restaurants Inc.
  DRI,
  -1.96%
  rose 1.1% after the coronavirus omicron wave drove an earnings miss.

Other assets

• The yield on the 10-year Treasury note
  TMUBMUSD10Y,
  2.478%
  rose 2 basis points to 2.340%. Yields and debt prices move opposite each other.

• The ICE U.S. Dollar Index
  DXY,
  +0.02%,
  a measure of the currency against a basket of six major rivals, rose 0.2%.

• Bitcoin
  BTCUSD,
  -0.24%
  rose 4% to trade near $43,900.

• Gold futures
  GC00,
  -0.23%
  rose 1.3%, to settle at $1,962.20 an ounce.

• The Stoxx Europe 600
  SXXP,
  +0.11%
  fell 0.2%, while London’s FTSE 100
  UKX,
  +0.21%
  settled up 0.1%.

• The Shanghai Composite
  COMP,
  -0.16%
  fell 0.6%, while the Hang Seng Index
  HSI,
  -2.47%
  lost 0.9% and Japan’s Nikkei 225
  NIK,
  +0.14%
  rose 0.3%.

—Steve Goldstein contributed additional reporting