Global stocks tumbled while safe-havens rallied and oil surged on Tuesday as Europe’s eastern flank stood on the brink of war after Russian President Vladimir Putin ordered troops into breakaway regions of eastern Ukraine.
In contrast, Brent crude futures rose 1.5 per cent to $96.85, after touching a new seven-year high at $97.21 early in the session on worries Russia’s energy exports could be disrupted. Spot gold added 0.2 per cent to $1,909.10, having earlier hit a new six-month top of $1,911.56. [GOL/] [O/R] Washington and European capitals condemned the move, vowing new sanctions. Ukraine’s foreign minister said he had been assured of a “resolute and united” response from the European Union.
Casanova said the consequences would be higher oil prices, an equity sell off, and people flocking to safe haven assets like the Japanese yen. In currency markets, moves were more muted, barring the Russian rouble which hit an 18-month low early in Asian trading, before steadying.