Wall Street rises as the United States imposes new sanctions on Russia

US stocks finished sharply higher on Thursday, led by a 3% gain in the Nasdaq, in a dramatic market reversal as US President Joe Biden announced harsh new sanctions against Russia after Moscow launched an all-out invasion of Ukraine. The S&P 500 gained more than 1%, reversing a four-day decline caused by concerns about the escalating crisis. The Dow finished in the black as well. Following consultations with Group of Seven counterparts, Biden announced measures to impede Russia’s ability to conduct business in the world’s major currencies, as well as sanctions against banks and state-owned enterprises.

The White House has warned Americans that the conflict could raise fuel prices in the United States, but US officials have been working with counterparts in other countries on a joint release of additional oil from global strategic crude reserves. On news of Russia’s invasion of Ukraine, all three major indexes sold off early in the day, with the Nasdaq down more than 3% at the open. Following Biden’s remarks, they hit session highs and rallied into the close.

“The tough stance taken by the United States and Europe sends a clear message to financial markets that they intend to cripple the Russian economy as much as possible,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. “From one perspective, that’s a positive,” he said, adding that the market’s selling may not be over. “In the future, we’re probably going to see higher oil prices and higher commodity prices.”

Investors have been concerned about how rising inflation will affect the Federal Reserve’s outlook and higher interest rates. On Thursday, Ukrainian forces fought Russian invaders on three fronts after Moscow launched a land, sea, and air assault in the largest attack on a European state since World War II. In a reversal of recent trends, the information technology sector (.SPLRCT) rose 3.5 percent, giving the S&P 500 its biggest boost. The Dow Jones Industrial Average (.DJI) increased by 92.07 points, or 0.28 percent, to 33,223.83, the S&P 500 (.SPX) increased by 63.2 points, or 1.50 percent, to 4,288.7, and the Nasdaq Composite (.IXIC) increased by 436.10 points, or 3.34 percent, to 13,473.59.The Nasdaq was down more than 20% from its November closing record high early in the session. If it had closed at that level, it would have confirmed that the market was in a bear market.”Tech had the most technical damage, so it’s encouraging to see tech picking up the pieces,” said Jamie Cox, managing partner of Harris Financial Group in Richmond, Virginia.

The S&P 500 confirmed earlier this week that it was in a correction. When an index closes 10% or more below its record closing level, a correction has occurred. The CBOE Volatility Index (.VIX), also known as Wall Street’s fear gauge, finished the day lower. “A lot of the uncertainty was priced in,” said Keith Lerner, co-chief investment officer at Truist Advisory Services in Atlanta. On the NYSE, advancers outnumbered decliners by a 1.14-to-1 ratio; on the Nasdaq, advancers outnumbered decliners by a 1.53-to-1 ratio. The S&P 500 set two new 52-week highs and 64 new lows, while the Nasdaq Composite set 19 new highs and 974 new lows. Volume on US exchanges was 17.52 billion shares, compared to an average of 12.1 billion for the full session over the last 20 trading days.