- Putin declares independence in two separatist-held Ukrainian regions
- Holidays in the United States
- Stocks and crypto under pressure, commodities prices move higher
Major European indices erased early gains and closed from 0.39% to 2.0% lower pressured by threats of escalated military conflict amid continued reports of Ukrainian ceasefire violations in the self-proclaimed Donetsk and Luhansk People's Republic territories, to which Kyiv denied. At the same time, President Putin told German chancellor Scholz and French president Macron that they will sign a decree and treat both territories as independent states which raised concerns that the Kremlin could openly deploy troops. Later on during his speech on national television, Putin officially confirmed that Luhansk and Donetsk are independent regions. Over the weekend, Ukrainian President Volodymyr Zelenskyy criticized the West’s response to Russian meddling in Ukraine over many years saying promises to protect Ukraine’s sovereignty enshrined in the Budapest memorandum in 1994 seemed worthless. He called for the west to send more arms and to impose preventive sanctions immediately. “What are you waiting for? We don’t need your sanctions after the bombardment will happen and after our country will be fired on, or after we have no borders, or economy.”
Monday is a public holiday in the US nevertheless stock futures fell by more than 1% due to the ongoing geopolitical concerns and the hawkish comments of the FED Bowman. Nevertheless, investors are waiting for tomorrow's opening of the cash market, which will indicate a real reaction to the news from the East.
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Create account Try a demo Download mobile app Download mobile appThe prices of energy commodities rose sharply during today’s session. Crude oil gains over 2.5%, while gold prices returned above $ 1,900. At the same time, natural gas is gaining ground, which, despite its seasonal nature, jumped 7% on Monday.
The foreign exchange market also takes into account the potential risk of conflict as many investors turned to safe haven currencies like US dollar and the Swiss franc. One can also notice the strength of both Australian and New Zealand dollars which are benefiting from rising commodity prices. It is also worth mentioning that the market expects the continuation of the hawkish rhetoric from the RBNZ during its Wednesday meeting. Australia on Monday opened its international border for the first time in almost two years.
The threat of an escalation of the conflict had a negative impact on the largest cryptocurrencies. Bitcoin's price has fallen below $ 38,000, and weakness also affects its main competitor Ethereum, which drops below $ 2,700.
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