The Dow Jones Industrial Average rose 0.3% to 33,223.83, the S&P 500 added 1.5% to 4,288.70, and the Nasdaq Composite advanced 3.3% to 13,473.58 on Thursday. All three indexes ended near their session highs.
Financials and consumer staples were the hardest hit sectors as the attack on Ukraine unfolded, while technology and communication services led the gainers in a sharp reversal of losses.
Haven asset gold futures dropped by 0.5% to $1,900.20 per troy ounce.
West Texas Intermediate crude oil traded up 0.8% to $92.80 a barrel after earlier topping the $100 mark for the first time since 2014 as concerns mounted that the conflict would undermine energy supplies.
The 10-year US Treasury yields were down by over one basis point to 1.97% after earlier slumping by more than 10 basis points.
Scotiabank expects the Federal Reserve in March to stay on course with a planned monetary policy tightening rather than suspending plans in response to the burgeoning geopolitical crisis. However, Allianz advisor Mohamed El-Erian told CNBC that market speculation of about eight to nine interest rate hikes is now "completely off the table."
Biden announced sanctions against additional Russian financial institutions, freezing their holdings in the US and other countries to reduce Russia's ability to trade with the rest of the world while cutting off funding and high-tech exports from Russia that will leave the country weaker for an extended period, according to the president.
The US Treasury is imposing sanctions on Russia's two largest financial institutions: Public Joint Stock Co. Sberbank of Russia and VTB Bank Public Joint Stock Co., which compose more than half of the total banking system in Russia.
Treasury also said it would also issue sanctions against three other institutions -- Otkritie, Novikom, and Sovcom -- which together hold combined assets of $80 billion.
Russian President Vladimir Putin announced the military operation early Thursday. The assault began with a series of missile attacks against locations near the capital Kyiv, as well as the use of long-range artillery against Kharkiv. It quickly spread across central and eastern Ukraine as Russian forces attacked the country from three sides, according to media reports.
Berenberg anticipates the risk to global credit and money markets, excluding Russia, will be minimal. It said major central banks, including the Federal Reserve, the European Central Bank, and the Bank of England, could take measures to ensure global financial infrastructure continues to function smoothly.
Meanwhile, US gross domestic product grew at a 7% annual rate in the second estimate for Q4, in line with the forecast but up from the 6.9% initial estimate. New unemployment claims fell to 232,000 in the Feb. 19 week from a 249,000 revised level, a steeper drop than a drop to 235,000 expected, according to data compiled by Bloomberg.
In company news, Moderna (MRNA) posted higher-than-expected results for Q4, driven by sales of its COVID-19 vaccine, which the biotechnology company now expects to generate at least $19 billion in revenue in 2022. Shares surged 15%, the top performer on the Nasdaq 100 and the second-biggest gainer on the S&P 500.
Leading the S&P 500 gainers was Enphase Energy Inc. (ENPH), which rose 16.4% after reporting the day before a growing number of battery system deployments in Ohio.
Alibaba Group (BABA) reported mixed fiscal Q3 results, with revenue falling short of analysts' consensus but earnings exceeding estimates. Shares dropped 0.7%.
Silver was 1.6% lower to $24.21 an ounce. Among energy ETFs, the United States Oil Fund was down 0.2% to $66.34, and the United States Natural Gas Fund was up 1.1% to $16.29.
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