U.S. Stocks Advance as Ukraine Optimism Outweighs Iraq

By Elena Popina and Namitha Jagadeesh  

Aug. 8 (Bloomberg) -- Morgan Stanley Investment and Portfolio Strategies’ Lisa Shalett discusses her investment ideas on “Bloomberg Surveillance.” (Source: Bloomberg)

U.S. stocks rose, after the Dow Jones Industrial Average fell to the lowest level since April yesterday, as a report that Russia wants to de-escalate the crisis in eastern Ukraine outweighed American airstrikes in Iraq.
The Standard & Poor’s 500 Index added 0.2 percent to 1,913.98 at 10:07 a.m. in New York. The Dow rose 29.81 points, or 0.2 percent, to 16,398.08.
“The market is looking abroad today--at Russia and Iraq, and with Russia it’s going to be a little bit of relief for the market rather than anything else,” John Manley, who helps oversee about $233 billion as chief equity strategist for Wells Fargo Funds Management in New York, said in a phone interview. “In Iraq, the market is looking at whether this situation will affect the oil flow.”
Equity futures jumped earlier today after RIA Novosti reported that Russia seeks a de-escalation of the conflict in Ukraine. The news service cited Russian Security Council head Nikolai Patrushev. Futures had retreated as President Barack Obama approved airstrikes i
n Iraq, and rocket attacks marked the end of a cease-fire between Israel and Hamas.
The S&P 500 fell 0.6 percent yesterday, taking its loss this week to 0.8 percent. The gauge closed yesterday below its average price for the past 100 days for the first time since April. The Dow is trading near its average price in the past 200 days.
The S&P 500 has dropped 3.8 percent from a record on July 24 as Russia amassed troops along Ukraine’s border and as conflict escalated between Israel and Hamas.

Airstrikes

The U.S. carried out airstrikes against militants from Islamic State in Iraq, the Pentagon said, a day after President Barack Obama authorized the use of military force to protect refugees. U.S. planes carried out a strike on artillery positions that had been used by the militants to attack Kurdish forces defending their regional capital Erbil, where U.S. diplomatic personnel are based, Pentagon spokesman Admiral John Kirby said in a post on Twitter.
Israel’s military said rockets were fired from the Hamas-controlled Gaza Strip after the three-day cease-fire ended at 8 a.m. local time. Islamic Jihad, a militant group that also operates in Gaza, claimed responsibility for as many as 10 rockets fired after the truce expired.
Data today showed the productivity of U.S. workers rose more than projected in the second quarter, rebounding from the biggest drop in more than three decades and helping to restrain labor costs.