By Yasin Ebrahim

Investing.com — The S&P 500 fell Tuesday, paced by a slump in banking stocks as Treasury yields slipped on safe-haven buying and a surge in oil prices dampened the economic outlook as Russia intensified its assault on Ukraine.

They fell 1.8% and 2.2% respectively, 746 points. The dropped 1.6%.

Russia on Tuesday continued to advance on the Ukrainian capital Kyiv after reportedly launching a heavy assault in Kharkiv, the country’s second largest city.

As investors seek safety in the ongoing Russia/Ukraine conflict, the U.S. Treasury yields, which are inversely related to the prices of the US, led to a selloff in the financials.

The megacap bank stocks were also hit hard, with JPMorgan Chase & Co (NYSE:) plunging to 52-week lows. Wells Fargo & Company (NYSE:) and Bank of America Corp (NYSE:) were down sharply.

As well as geopolitical tensions, U.S. Treasury yields have been pressured by expectations that the Federal Reserve isn’t likely to raise interest rates as aggressively as initially expected.

From 34% last week’s prediction, the probability of receiving 50 basis points has fallen to around 1%. Investing.com’s Fed Rate Monitor Tool.

U.S. oil prices rose above $100 a barrel for the first time since 2014 as potential supply disruptions from the ongoing geopolitical tensions offset the International Energy Agency’s release of 60 million barrels of oil from emergency reserves to ease rising prices.

APA Corporation (NASDAQ) Chevron Occidental Petroleum Corporation (NYSE 🙂 and Corp (NYSE 🙂 were two of the largest gainers. The former was up more than 5%.

With the exceptions of Alphabet, Amazon (NASDAQ), Microsoft (NASDAQ), and Meta Platformss (NASDAQ), they were all about 1% less.

Earnings: Target Corporation (NYSE: ) was a huge winner, after posting better than expected fourth quarter results and guidance suggesting that growth will continue post-pandemic.

Zoom Video Communications Inc (NASDAQ) dropped nearly 6 percent after quarterly results beat both top and bottom line. However, the full-year and first quarter guidance which indicated a slowing of normalizing videoconferencing software demand offset the gains. RBC cut its price target on Zoom to $200 from $300 as guidance signaled a “material revenue deceleration,” but the bank kept its outperform rating on the stock amid expectations that “sentiment may be close to bottoming out.”

Lucid Group Inc (NASDAQ) suffered a wider than expected loss due to revenue that was below estimates, sending shares up more than 15%

While economic data showed that U.S. manufacturing activity was more robust than predicted in February, supply-chain problems continue to plague the country.

“The data does not reflect too much progress in the struggle to rebuild inventories and clear order backlogs,” Jefferies said in a note.