According to UK Senior Market Analysts Craig Erlam and OANDA’s EMEA.
At the European closing price on Tuesday, the stock market was under great pressure as Ukraine continued to invade and oil prices soared.
Despite yesterday’s talks between the delegations of both countries on the border with Belarus, the Russian invasion of Ukraine continues to escalate. More negotiations are expected this week, but they will not delay the attack on Kyiv and will have a major impact on the sadness of most countries around the world.
The sanctions announced so far have been devastating to the Russian economy and will increase further in the future. Efforts to isolate Russia are exacerbated by the actions of Western companies trying to break ties under immense political pressure. For Putin’s Russia, life is getting harder and harder.
PMI overshadowed by eastern events
Various PMI data have been released around the world today, but as you might expect, they didn’t get the usual attention. Much of this data is promising, but it has not taken into account recent events and has been revised, so most of it has already been taken into account. As with most economic data this week, focusing on what’s happening in Ukraine is unlikely to have a significant impact on the market.
Oil soars as sanctions are imposed and conflicts escalate.
As Ukraine’s conflict intensifies, oil prices soar again, the West continues to impose strict sanctions, and businesses turn their backs on increasingly isolated Russia. We are beginning to see the impact of these sanctions on Russia’s oil exports and the challenges they pose, pushing up prices.
Oil rallies are accelerating seriously today, surpassing $ 100 and gaining momentum in the process. This is of little help in calming the nerves, despite the fact that the United States once again led the discussion on the adjusted release of oil reserves of about 60 to 70 million barrels. We saw a disappointing reaction when this happened in November, before Russia invaded Ukraine.
Gold, a safe haven, continues to rise
Gold will rise again in risk aversion as Russia’s attacks on Ukraine intensify. Market sentiment has deteriorated throughout the session and gold prices have risen in parallel. This rise is also seen as oil prices soar again today and inflationary pressures around the world have increased.
The attractiveness of safe havens and inflation hedging greatly supports the price of gold. Gold is currently above $ 1,930 and may target $ 1,950 in the near future. Beyond that, unfortunately, there is nothing we see in Ukraine or border negotiations, so $ 2,000 suddenly looks pretty achievable.
Bitcoin regains bullish momentum
Bitcoin continues to perform well following the new sanctions imposed on Russia, and I have the impression that the imposition of these sanctions could make cryptocurrencies more attractive. Not to mention recent reports of huge cryptocurrency donations to Ukraine to support Ukraine’s efforts. Links to risky assets have been broken so far, and Bitcoin seems to be on his own path. That’s over $ 40,000, and $ 45,500 may not be too far away.
Translated at www.DeepL.com/Translator (free version)
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