Renewed fighting in Ukraine erases stock gain

Traders work on the floor of the New Traders work on the floor of the New York Stock Exchange on Wall Street on Monday, Aug. 11, 2014. Photo Credit: Bloomberg News / Jin Lee

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Renewed fighting in Ukraine knocked the stock market lower Friday. Major indexes headed higher at the start of trading, then sank following news that Ukrainian soldiers attacked a Russian military convoy.

U.S. government bond prices jumped as investors sought safety, driving the yield on the 10-year note to its lowest level this year. Oil prices rose.

KEEPING SCORE: The Dow Jones industrial average was down 130 points, or 0.8 percent, to 16,581 as of noon on Wall Street. The Standard & Poor's 500 index was down 13 points, or 0.7 percent, to 1,942. The Nasdaq composite dropped 23 points, or 0.5 percent, to 4,431.

REACTION: John Canally, the chief economic strategist at LPL Financial, said it's understandable that traders dropped stocks in response to the flare-up. "Anyone who doesn't want to lose their job over the weekend sells first and asks questions later," he said.

Canally suspects the dispute between Russia and Ukraine will likely follow the pattern of recent months. Worrying headlines will be followed by soothing speeches. "We've been here before," he said.

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UKRAINE: Investors were rattled by news that crossed at midmorning Eastern time that Ukrainian troops had destroyed a number of Russian military vehicles that had crossed into the country, according to NATO and the Ukrainian president.

EUROPE: The reports out of Ukraine rattled several European stock markets. Germany's DAX dropped 1.4 percent, and France's CAC 40 fell 0.7 percent. The FTSE 100 index of leading British shares was up 0.1 percent.

OIL AND BONDS: The yield on the 10-year Treasury note plunged to 2.30 percent, the lowest since June 2013 as investors plowed money into U.S. government bonds. The yield was 2.40 percent late Thursday. Benchmark U.S. crude oil rose 95 cents to $96.53 a barrel.

MONSTER DEAL: Monster Beverage soared 28 percent after news that Coca-Cola plans to pay $2 billion for a stake in the maker of caffeinated drinks. The deal comes as Coca-Cola's flagship soda business is flagging and "energy drinks" have become popular. Monster jumped $20.05 to $91.70.

KNOWN AS NORDY'S: Nordstrom reported a slight drop in earnings as well as sales that fell just short of analysts' estimates. The department-store's stock slid $2.84, or 4 percent, to $65.85.

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HACKED: SuperValu, a grocery store chain, said hackers gained access to its computer network for handling credit-card transactions. The company said it isn't sure yet if customers' account numbers and other information were stolen. SuperValu fell 38 cents, or 4 percent, to $9.21.

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