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Russia-Ukraine War Erupted And Inflation Worsened But Outlook Drove Stocks Higher For The Week

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Russia declared war on Ukraine on Thursday. Initially, the first war in Europe since World War II, sent stock prices plunging. For the second time in four weeks, the Standard & Poor’s 500 stock index declined by about -10% from its January 3rd all-time closing high. 

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Meanwhile, in other news inflation worsened. Data released Friday showed the buying power of Americans shrank, with buying power eroded at the worst 12-month rate in about 40 years. Real disposable personal income per capita plunged -10.1% in the 12 months through January 31, 2022.  

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Despite the Russian invasion of Ukraine and worsening inflation numbers, the stock market closed Friday eight-tenths of 1% higher than a week ago. 

Why? Because the economy and earnings outlook remains bright. Neither the Russian-Ukraine War nor the high inflation rate dim the forecast for the U.S. economy.   

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The Standard & Poor’s 500 stock index closed Friday, February 25, 2022, at 4,384.65. The stock index gained +2.24% from Thursday and +0.81% from last week. In the 23 months since the March 23, 2020, bear market low, stocks are up +64.85%. 

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