US markets closed lower; Ukrainian, Russian tension soars

The US markets closed lower on Friday, putting a cap on weekly gains, on news of a clash between Ukrainian and Russian military units on Ukraine soil. Ukrainian government troops attacked an armed convoy that had crossed the border from Russian territory. On the economy front, a gauge of consumer sentiment in August hit the lowest level in nine months, as a rocky stock market helped to depress expectations about the future. The preliminary August reading on the University of Michigan/Thomson Reuters consumer-sentiment index fell to 79.2 - the lowest level since November - from a final July result of 81.8. Consumers’ views on the upcoming economy grew decidedly grimmer this month, with the gauge tumbling to 66.2 from 71.8 in July. In a sign of low inflation pressure, US producer prices inched up in July, led by services. US producer prices rose 0.1% in July, a second consecutive month of gains. Excluding the volatile categories of food, energy and trade, the core gauge of producer prices rose 0.2% last month.

However, an index of manufacturing conditions in the New York area continued to grow in August but at a slower pace than the four-year high reached in the prior month. The Empire State’s general business conditions fell to 14.7 in August from 25.6 in July. America’s growing and continued demand for cars and light trucks produced a 10.1% surge in motor vehicles and parts output in July. The gain helped industrial production more broadly rise a seasonally adjusted 0.4% in July. The rise in motor vehicles and output could in part reflect decisions by auto companies to keep producing in the summer instead of shutting down to retool. Capacity utilization in the motor vehicles and parts segment surged to 88.6% in July from 80.5% in June.

The Dow Jones Industrial Average added 91.26 points or 0.55 percent to 16,651.80, Nasdaq was up by 44.88 points or 1.02 percent to 4,434.13, while the S&P 500 gained 12.97 points or 0.67 percent at 1,946.72. 

Indian ADRs closed mixed on Friday; Dr. Reddy’s Lab was down 0.27%, Wipro was down by 0.24% and ICICI Bank was down by 0.23%. On the other hand, Tata Motors was up by 0.45% and HDFC Bank was up 0.21%.