S&P 500 Futures drop 2.50% as Russia-Ukraine crisis escalates

Global markets began the week on a back foot on Russia-Ukraine headlines.
Russia-Ukraine agrees to talk peace but Moscow keeps nuclear facilities on high alert.
Western sanctions cripple Russia's economy, oil in focus.
Second-tier US data may entertain traders ahead of Friday’s US NFP, nothing more important than geopolitics.

Anil Panchal FXStreet

Market sentiment remains sour as weekend headlines couldn’t placate fears of a full-fledged war between Ukraine and Russia, despite the latest agreement to talk for peace. While portraying the mood, S&P 500 Futures decline 2.5% to 4,275 whereas the US 10-year Treasury yields struggle around 1.96% by the press time.

The West agreed to cut some of the Russian banks from the SWIFT international payment system, also marked sanctions on the Russian central bank, to portray their dislike of Moscow’s invasion of Ukraine. In a reaction, Russian President Vladimir Putin puts nuclear deterrence forces on high alert and offered another blow to the market sentiment.

However, headlines conveying the Ukraine-Russia peace talks, at the Belarus-Ukrainian border, may offer a sigh of relief but global uncertainty keeps optimists at bay.

It’s worth noting that the US dollar cheers the market’s risk-off mood, which in turn drowns Antipodeans. However, firmer oil prices keep CAD buyers hopeful.

Despite fewer hopes of a settlement of geopolitical disputes between Kyiv and Moscow, any progress in talks will offer a good start to the week’s trading, especially to the riskier assets. However, any negatives won’t be taken lightly and can trigger a rush to risk-safety that propelled the US dollar and gold to the multi-month high in the last week.

Hence, markets are dicey amid growing anxiety over the Russia-Ukraine stand-off and hence traders should remain cautious.

Read: Ukraine and Russia are set to hold negotiations at the Belarusian-Ukrainian border

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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