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S&P 500 rises Friday, posts second winning week in a row

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The S&P 500 rose Friday to close out a winning week even as investors weighed interest rate hikes and war in Ukraine.

The Dow Jones Industrial Average rose 153.3 points, or 0.4%, to 34,861.24. The S&P 500 added 0.5% to close at 4,543.06. The Nasdaq Composite dipped about 0.2% to 14,169.30.

All three major averages notched second consecutive winning weeks. The Dow ticked up 0.3%. The S&P 500 gained 1.8%, and the Nasdaq rallied nearly 2% week to date.

The S&P 500 is now up about 3.9% higher in March, more than erasing its losses since Russia invaded Ukraine late last month.

The rebound has come even as the war in Ukraine continues and interest rates shoot higher, with the Federal Reserve is set to hike rates several more times this year.

“Equities are rallying despite a hawkish Fed and stagflation concerns, as many believe there is no alternative to stocks,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.

The benchmark 10-year rate on Friday touched a fresh multi-year high of 2.5% as investors priced in a more aggressive rate hike cycle.

Financial stocks rose Friday as the 10-year yield jumped. Bank of America and Wells Fargo rose 1.5% and 2.4%, respectively

On the downside, technology stocks eased, weighing on the Nasdaq. Zoom fell 3.2% and DocuSign lost 3.9%, among the Nasdaq’s worst decliners Friday.

Fed Chair Jerome Powell on Monday vowed to be tough on inflation. The remarks came after the Fed raised interest rates for the first time since 2018 last week, with hikes coming at each of the six remaining policy meetings this year.

Powell on Monday noted rate hikes could go from the traditional quarter-percentage-point moves to more aggressive half-point increases if necessary.

The central bank chief’s comments led Wall Street to raise rate hike expectations, with firms from Goldman Sachs to Bank of America penciling in half-point hikes in future Fed meetings this year.

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Meanwhile, investors looked to promising signs the economy can run strong even as the interest rates have climbed amid expectations for a more aggressive Fed.

First-time jobless claims last week reached the lowest tally since 1969, the Labor Department reported Thursday — the latest sign of a resilient labor market. Economists expect the March jobs report next week to show similar strength.

“The 10-year yield is rising at the same time that the belief in growth is not collapsing. It’s permeating the market and lifting stocks a bit because that was the immediate concern of the impacts of the war in Ukraine,” Yung-Yu Ma, BMO Wealth Management’s chief investment strategist, said.

Traders kept an eye on Europe as the Ukraine-Russia war continues. The European Union on Friday struck a gas deal with the U.S. in an effort to reduce its dependency on Russian energy.

—CNBC’s Christopher Hayes contributed to this report.



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Investor Kevin Simpson picks 5 dividend-paying stocks to survive high inflation

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Virgin Atlantic ceases Hong Kong operations, cites Russian airspace closure

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Virgin Atlantic has not operated any passenger flights to Hong Kong since December 2021, after the city-state suspended all flights from the U.K. due to a resurgence in Covid-19 cases.

Sopa Images | Lightrocket | Getty Images

British airline Virgin Atlantic announced Wednesday it was permanently ceasing operations in Hong Kong due to issues related to the closure of Russian airspace.

The decision marks the end of the carrier’s London Heathrow to Hong Kong flight route and the closure of its Hong Kong office. It also ends the airline’s 30-year presence in the Asian financial hub.

Virgin Atlantic said in a statement that the closure of Russian airspace following Moscow’s invasion of Ukraine in late February was one of several “complexities” contributing to the decision.

It said that on the basis of the airspace remaining closed, Heathrow to London flight times would be around one hour longer than in 2019, while Hong Kong to Heathrow flights would be 1 hour 50 minutes longer.

It added that the 2019 termination of Virgin Australia’s Hong Kong to Melbourne and Hong Kong to Sydney services had already reduced the airline’s presence in the city-state.

“After careful consideration we’ve taken the difficult decision to suspend our London Heathrow – Hong Kong services and close our Hong Kong office, after almost 30 years of proudly serving this Asian hub city,” a spokesperson for the airline said.

“Significant operational complexities due to the ongoing Russian airspace closure have contributed to the commercial decision not to resume flights in March 2023 as planned, which have already been paused since December 2021,” it added.

Virgin Atlantic has not operated any passenger flights to Hong Kong since December 2021, after the city-state suspended all flights from the U.K. due to a resurgence of Covid-19 cases.

The airline was previously due to resume Hong Kong services from March 2023. However, with Wednesday’s announcement, it said it would be able to increase services in other key markets from next summer.

Around 46 Virgin Atlantic jobs, including those of office staff and cabin crew, are set to be impacted by the decision, according to Bloomberg.

The airline said it would offer refunds or vouchers for alternate Virgin Atlantic services to the “limited number” of customers due to travel from March next year.

Virgin’s exit from Hong Kong is the first by a major airline since American Airlines left the city in late 2021.



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German minister criticizes U.S. over ‘astronomical’ natural gas prices

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A photo of a natural gas flare burning near an oil pump jack at the New Harmony Oil Field in the U.S. on June 19, 2022.

Luke Sharrett | Bloomberg | Getty Images

Germany’s economy minister accused the U.S. and other “friendly” gas supplier states of astronomical prices for their supplies, suggesting they were profiting from the fallout of the war in Ukraine.

“Some countries, including friendly ones, sometimes achieve astronomical prices [for their gas]. Of course, that brings with it problems that we have to talk about,” Economy Minister Robert Habeck told regional German paper NOZ in an interview published Wednesday which was translated by NBC News. He called for more solidarity from the U.S. when it comes to assisting its energy-pressed allies in Europe.

“The United States contacted us when oil prices shot up, and the national oil reserves in Europe were tapped as a result. I think such solidarity would also be good for curbing gas prices,” he said.

CNBC contacted the White House for a response to the comments and is awaiting a reply.

Habeck, the co-leader of Germany’s Green Party, which is a part of Berlin’s coalition government led by center-left Chancellor Olaf Scholz, said the EU should also do more to address the region’s gas crisis, with countries scrambling for alternative supplies which has pressured prices even more, that was brought about by the war in Ukraine and deteriorating relations with Russia.

The U.S. energy economy is benefiting while Europe suffers, says Citi's Morse

Moscow’s state-owned gas giant Gazprom has cut supplies to the bloc drastically over the last few months, largely due to international sanctions and a desire to punish Europe — the EU used to import around 45% of its gas supplies from Russia but is seeking to halt all imports — for supporting Kyiv.

Habeck said the EU “should pool its market power and orchestrate smart and synchronized purchasing behavior by the EU states so that individual EU countries do not outbid each other and drive up world market prices.” 

European market power is “enormous,” it just has to be used, he noted, according to the German news outlet.

Europe is facing a hard winter with gas shortages predicted across the region. Countries like Germany have been largely dependent on Russian gas supplies for decades with massive energy infrastructure, such as the Nord Stream 1 and 2 gas pipelines, designed to bring gas from Russia to Germany via the Baltic Sea.

While the $11 billion Nord Stream 2 pipeline was never even launched, with Germany refusing to certify the pipeline following Russia’s invasion of Ukraine in February, Nord Stream 1 has become a pawn in souring relations between Moscow and Brussels.

Over the summer, gas supplies via the pipeline stopped and started seemingly at Moscow’s whim, although it invariably cited the need for maintenance and sanctions as a reason for halting supplies. But then supplies came to a halt in September.

More recently, Russia and Europe’s energy ties have literally been damaged with the Nord Stream pipelines suffering leaks last month in suspicious circumstances.

Russia denied it had sabotaged the pipelines, with reported underwater explosions damaging the pipes in several places, sending natural gas spewing from the Baltic Sea. The damage prompted an international outcry with the EU vowing a “robust” response to attacks on its energy infrastructure.



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