Shares slipped as Russia’s sanctions bit, and oil explosions crossed $ 110

On February 1, 2020, a broker reacts while trading on his computer terminal at a stock brokerage firm in Mumbai, India. REUTERS / Francis Mascarenhas

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  • MSCI Asia Ex-Japan -0.56%, Nikkei -1.68%
  • Euro Stoxx, DAX Futures Point Low Open
  • Brent crude has risen above $ 110, its highest since the beginning of July 2014
  • Biden announced a ban on Russian aircraft using US airspace
  • U.S. yields are recovering from an eight-week low

SHANGHAI, March 2 (Reuters) – Asian stocks were under renewed pressure on Wednesday and oil prices topped $ 110 a barrel as investors worried about the impact of sanctions against Russia over its occupation of Ukraine.

European stock markets were set for weaker openings after falling on Tuesday, with Euro Stocks 50 futures down 0.13% and German DAX futures down 0.17% on early trading. FTSE futures rose 0.34%.

In the wake of the recent tightening of restrictions on Moscow, the United States has banned Russian flights using US airspace, following similar moves by the European Union and Canada.

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US President Joe Biden announced the ban during his State of the Union address on Tuesday, saying Russian President Vladimir Putin would “continue to pay a high price” for invading Ukraine. read more

Wide index of MSCI of Asia-Pacific equities outside Japan (.MIAPJ0000PUS)China’s blue-chip CSI300 fell 0.56% (.CSI 300) The index is down 1.12%.

Nikkei of Japan (.N225) Fell 1.68%.

In Australia, the benchmark ASX 200 (.AXJO) The index rose 0.28% despite a risk-free mood elsewhere as commodity prices rose and stocks rose.

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“The Russia-Ukraine conflict will dominate markets in the future. Yesterday’s announcement that Russia will not pay coupons to foreign holders on its government debt will push investors to more secure havens,” ING analysts said in a statement.

“Support for the launch of the EU membership process for Ukraine shows the similarity of support for Ukraine from Western Europe, but it is unlikely to help calm tensions.”

On Tuesday, the S&P 500 (.SPX) And Nasdaq compound (.IXIC) The Dow Jones Industrial Average fell about 1.6% (.DJI) Fell nearly 1.8%.

Global sanctions against Russia have prompted large corporations to announce the suspension or exit of their businesses in the country.

Exxon Mobil (XOM.N) Russia said on Tuesday it was withdrawing from operations, including in the oil sector, following similar decisions by British oil companies BP PLC and Shell and Norway’s Equinor ASA. (EQNR.OL) read more

Exxon’s announcement comes as oil prices continue to rise. On Wednesday, global crude oil prices crossed $ 110 per barrel, up more than 5.8% to $ 111.09, the highest level since early July 2014.

US West Texas Intermediate crude rose nearly 6% to $ 109.30, the highest level since September 2013.

The rise comes despite a global agreement to release 60 million barrels of crude oil reserves in an effort to curb rising prices and rising inflationary pressures.

Carlos Casanova, UBP’s senior Asian economist in Hong Kong, said: “We think there is still room for oil prices to continue to rise.

In the currency market, the dollar was up 1.88% at 107.01 against the ruble, after hitting a record high of 117 a day earlier.

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The dollar was strong against the yen, up 0.12% to 115.03 and the euro was down $ 1.1112. Against the basket of currencies of other major trading partners, the dollar rose 0.15% to 97.464.

The rise in the greenback came as US Treasury yields fell to an eight-week low on Tuesday. Investors are betting that the changing global growth outlook will push the Federal Reserve to sharply raise interest rates in the coming months.

US key 10-year yields rose to 1.7309% in late Tuesday from 1.711% and policy-sensitive 2-year yields rose to 1.3205% from 1.305%.

Fed fund futures markets are now pricing only a 5% chance of a 50 basis point rise at the central bank’s March meeting, although a small 25 basis point rise is considered a virtual certainty. FEDWATCH

In his speech on Tuesday, Biden called on companies to make more cars and semiconductors in the United States so that Americans will less rely on imports as a way to combat inflation.

Gold, which had touched an 18-month high last week, rose nearly 2% on Tuesday to $ 1,932.11, a 0.57% return on the dollar as the dollar strengthened due to the worsening Ukraine crisis.

Bitcoin, which had gained nearly 15.5% on Tuesday, strengthened by 0.23% to $ 44,341.68, strengthening its contradictory currency credentials.

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Report by Andrew Calbright; Editing by Sam Holmes

Our standards: Thomson Reuters Trust Principles.

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