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Investing.com – The S&P 500 fell into correction territory Tuesday, as fading hopes for a diplomatic solution to the Russian-Ukraine crisis triggered a risk-off sentiment across markets.
The S&P 500 fell 1.7%, and has entered correction territory after falling about 10% from its recent peak. The Dow Jones Industrial Average fell 1.9%, or 654 points, the Nasdaq slipped 2%.
Russian President Vladimir Putin confirmed that Russia had recognized the expanded borders of Luhansk and Donetsk after initially indicating that Moscow would recognize only the two separatist-held areas in Eastern Ukraine.
The White House said that Putin’s order for troops to move into the Donbas in Eastern Ukraine was the beginning of an invasion, stoking investor fears that stronger U.S. sanctions on Moscow could soon follow and exacerbate the security crisis.
President Biden, who has previously said the diplomatic route would remain open to Moscow up until Putin has started to attack Ukraine, is set to provide an update in ongoing Russia-Ukraine later on Tuesday.
Energy stocks gave up their intraday gains to fall more than 3% as oil prices eased from session highs.
Pioneer Natural Resources (NYSE:PXD), APA (NASDAQ:APA), and Devon Energy (NYSE:DVN) were the hardest hit stocks in the energy sector, with the latter down more than 6%.
Consumer discretionary stocks were also a big drag on the broader market, with Home Depot down more than 9% despite reporting better-than-expected fourth quarter results.
Home Depot (NYSE:HD) reported fourth-quarter earnings of $3.21 on revenue of $35.72 billion, underpinned by comparable sales of 8.1%.
Big tech including Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL), and Meta Platforms (NASDAQ:FB) were in the red.
Kraft Heinz (NASDAQ:KHC) bucked the trend lower, rising 4% after the food and beverage company boosted its long-term growth guidance and reiterated its guidance for 2022.
In other news, the special purpose acquisition company Digital World Acquisition (NASDAQ:DWAC), which is taking former President Donald Trump’s social media app Truth Social, surged on data showing the social media app had strong debut on Sunday as it racked up over 170,000 downloads on Apple’s App Store.
