US open: Dow and S&P advance in the wake of Ukraine ceasefire

US stocks advanced on Thursday as news of a ceasefire deal between Russia and Ukraine offset disappointing retail sales and weak jobless claims.

Just before 10:00 in New York, the Dow Jones Industrial Average was 63.04 points up, while the S&P 500 and the Nasdaq rose 9 and 30 points respectively.

After overnight talks in Minsk, Russia and Ukraine reached an agreement for a ceasefire starting on Sunday 15 February.
Initial claims for unemployment benefits in the US were higher than expected at 304,000 last week, according to the Department of Labor (DoL).

This figure for the week ending 7 February is up 9% on the revised 279,000 the week before and above the 290,000 that had been expected by economists at Barclays Research.

However, the four-week moving average was 289,750, a decrease of 3,250 from the previous week's revised average.

US retail sales volumes dropped by 0.8% month-on-month in January to reach $439.771bn, according to the US Department of Commerce.

The consensus estimate had been for a fall of 0.4%, but a 9.3% decline in sales at gasoline stations resulted in a bigger-than-expected overall drop.

“Federal Reserve chair Janet Yellen will be slightly dismayed to see retail sales stuck in negative territory," said UFX.com managing director Dennis de Jong.

"Many had hoped that lower gas prices and rising consumer confidence would spur spending in the retail sector, but the large gains just haven’t materialised as yet.

"Yellen will know that the other major economies around the world are hoping the US can stir global growth and will be watching the data very closely, with fingers crossed.”

Tesla’s stock was 8% lower after its latest sales figures out overnight fell short of analysts’ forecasts, as the company blamed the poor weather for missing its delivery targets.

JP Morgan has downgraded the shares to ‘underweight’ from ‘neutral’.

American Express plunged after it announced it will end its US co-branding and merchant acceptance agreement with Costco Wholesale Corp. on 31 March, while Zully nosedived after both earnings and outlook missed expectations.

Going the other way, Cisco jumped after its fourth-quarter earnings almost doubled to $2.4bn, while Whole Foods Markets rose after its earnings beat analysts’ forecasts.

Gold futures while the dollar lost over 0.8% against the yen and the pound and almost 0.5% against the euro.

Oil prices rebounded strongly following the announcement of ceasefire in Ukraine, with Brent crude rising over 3.6% to $56.74 a barrel, while West Texas Intermediate crude rose over 4.7% to $51.27 a barrel.