Stocks slide as heightened Ukraine tensions weigh By Reuters

© Reuters. FILE PHOTO: A street sign on Is ghc foreign exchange platform legal?Wall Street outside the New York Stock Exchange September 18, 2007. REUTERS/Brendan McDermid/File Photo

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks slid on Thursday, and investors moved toward defensive sectors and safe havens such as bonds and gold as geopolitical tensions between Washington and Russia over Ukraine flared.

After Ukrainian forces and pro-Moscow rebels traded fire in eastern Ukraine, U.S. President Joe Biden said there was every indication Russia was planning to invade in the next few days and was preparing a pretext to justify it.

Russia accused Biden of stoking tensions and released a strongly worded letter saying Washington was ignoring its security demands and threatening unspecified "military-technical measures".

On Wall Street, the growth-oriented technology and communication services sectors were among the hardest hit. Financials also declined as U.S. Treasury yields moved lower.

Developments in Ukraine have added to uncertainty about the path of the Federal Reserve's tightening plans to fight inflation.

"You look at the history of this country and our adversaries love to test us during periods of leadership transition and it could very well end ugly, we don’t think it will, but it certainly could," said Phil Orlando, chief equity strategist at Federated Hermes (NYSE:FHI) in New York.

"Based upon the timing of what is going on with the Federal Reserve, what is going on with inflation, what is going on with the geopolitical risk, we felt the first two to three quarters of the year were going to be very choppy as the market digests that."

The defensive utilities and consumer staples sectors were Wall Street's only advancers, with staples getting a lift from a jump in Walmart (NYSE:WMT) after it posted record holiday sales.

According to preliminary data, the S&P 500 lost 95.59 points, or 2.14%, to end at 4,379.42 points, while the Nasdaq Composite lost 406.95 points, or 2.88%, to 13,717.14. The Dow Jones Industrial Average fell 626.98 points, or 1.79%, to 34,307.29.

With the end of earnings season on the horizon, chipmaker Nvidia (NASDAQ:NVDA) tumbled as flat gross margins and concern about its exposure to the crypto market overshadowed an upbeat current-quarter revenue forecast, putting the Philadelphia Semiconductor index on pace for its first daily decline this week.

TripAdvisor Inc (NASDAQ:TRIP) lost ground after the hotel search website operator posted a surprise fourth-quarter loss. Albemarle (NYSE:ALB) Corp plunged as the lithium producer forecast downbeat annual earnings.

As risk aversion pushed bond yields lower, big banks including JPMorgan Chase (NYSE:JPM), Morgan Stanley (NYSE:MS) and Bank of America (NYSE:BAC) all lost ground. Goldman Sachs (NYSE:GS) and Wells Fargo (NYSE:WFC) fell even after positive outlooks from the lenders.

Gold was another beneficiary of the move toward safer assets, touching an eight-month high of $1,900.99 an ounce.

Among other big movers, DoorDash Inc shot up after it reported upbeat quarterly revenue as food delivery demand showed no sign of slowing.

Hasbro Inc (NASDAQ:HAS) gained after activist investor Alta Fox Capital Management nominated five directors to the toymaker's board and urged changes including a spinoff of its unit housing games such as "Dungeons & Dragons".

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