Europe, U.S. Levy Financial Sanctions Against Russia

U.S. stocks are rising a day after the S&P 500 fell into correction territory, as the U.S. and European nations hit Russia with a range of financial sanctions for its aggression against Ukraine and Russian President Vladimir Putin said that diplomacy is still an option in resolving the crisis.

Stocks aren’t fully retracing yesterday’s declines, when the Dow Jones Industrial Average (DJIA) sank 1.4% and all 11 sectors in the S&P 500 ended lower.

U.S. President Joe Biden announced a wave of sanctions against Russia, targeting banks and individuals. The EU is preparing to join the U.S. in forbidding the purchase of Russian government bonds, Bloomberg News reported. The yield on the 10-year Treasury jumped to 1.99%, while its price fell as investors seek the safe haven of government bonds.

Crude oil prices dipped this morning to around $92 per barrel, still well above the $76 per barrel level where they started the year. The price of Bitcoin (BTCUSD) is on the rise, above $39,000, with most other major cryptocurrencies trading higher as well. The euro strengthened against the dollar.

Lowe’s Companies, Inc. (LOW), Molson Coors Beverage Company (TAP), and The TJX Companies, Inc. (TJX) are among the companies reporting results today. So far, 78% of companies reporting results have beaten analyst estimates, according to FactSet.

Quick Hits: Today’s Headlines

Automaker Stellantis NV’s (STLA) shares surged after announcing it earned $15 billion in its first year after it was formed from the merger of Fiat Chrysler Automobiles and PSA Group. The maker of Jeep, Opel, and Peugeot vehicles was helped by higher prices and profit margins fueled by the computer chip shortage.

Barclays Plc (BCS) said that its fourth-quarter profit rose and beat analyst estimates despite a slowdown in trading and dealmaking. The London-based bank also announced a roughly $1.5 billion stock buyback plan, and its U.S.-traded shares jumped 6%.

Activision Blizzard, Inc. (ATVI) is reportedly delaying the release of its Call of Duty game next year. This would mark the first time in just under two decades the series hasn’t had an annual release after company executives decided the latest release “didn’t live up to expectations.”

eBay Inc. (EBAY) is expected to report a fall in revenue for the holiday quarter, hurt by a reversal of pandemic behavior where shoppers are returning to stores over shopping online. The e-commerce retailer and auction site has beaten analyst earnings estimates for three of the past four quarters. 

Apple Inc.’s (AAPL) retail stores have dropped mask mandates at most retail store locations. The stores will also restart in-person courses today, as COVID-19 cases continue to fall.

The Big Story: Facebook Ramps Up TikTok Rivalry

Facebook parent Meta Platforms, Inc. (FB) is going global with Reels, a short-form video offering, with a global rollout in more than 150 countries, in a big bet on its answer to TikTok. Facebook says video now accounts for half of the time people spend on the social media platform, with CEO Mark Zuckerberg calling Reels Facebook’s fastest growing content format, “by far.” 

The company also announced new ways for creators to make money through the Reels feature, expanding its program to pay creators bonuses to more countries and testing overlay ads using banners and stickers for creators to earn ad revenue. It will also release full-screen ads for Reels soon. Facebook said that eligible content creators can earn bonuses of up to $35,000 per month based on how many people watch their content.

Meta’s stock price had plunged earlier this month after its fourth quarter earnings report and outlook were hurt by changes to Apple’s privacy policies forcing apps to gain explicit consent for advertising tracking.

TikTok was the most-downloaded app last year and overtook Instagram in popularity among young users. Underscoring Meta’s concern about TikTok, the app was mentioned six times during Meta’s earnings conference call. Shares of Meta have lost 40% of their value so far this year.