, one of the biggest contributors to Russia’s national budget amid fears it could lead to a spike in energy prices and hurt the global economic recovery.“The move in risk assets higher may seem incongruous to the developments and news flow but may reflect a shift in market expectations given sanctions were not placed on energy markets,” said Kerry Craig, global market strategist at JPMorgan Asset Management.
Through January and February, fund managers had been loading up on options-market insurance and short positions during a near 12 per cent fall in the SP 500 since the start of the year. Investors unwound some of those positions on Friday, supporting the relief rally.
“If growth starts to become more scarce, we may see a further shift in risk appetite, especially considering the huge amount of uncertainty around Russia’s next move and the West’s response.”