Global markets see widespread sells offs following Russian invasion of Ukraine

On Thursday, US bond yields along with stocks fell sharply while the prices of gold, the USD and oil skyrocketed after Russian troops landed in Ukrainian cities on the Black Sea with Ukraine saying Moscow had launched a full-scale invasion.

According to a news report by Russian news agencies, troops have landed in the Ukrainian Black Sea port of Odessa and in Mariupol in the eastern Ukrainian region of Donetsk.

Ukrainian military command centres in the cities of Kyiv and Kharkiv have comes under missile strikes attacks said a report from Ukrainska Pravda citing an Ukrainian interior ministry official.

Russian President Vladimir Putin has called on Ukrainian soldiers to immediately lay down arms go back home saying the responsibility for any bloodshed will be on the conscience “of the Ukrainian regime”, according to comments carried by Russian news agencies.

Putin has also authorised special military operations in Ukraine’s Donbass region.

Several huge explosions were heard in the Kyiv, before dawn, shortly after Russia announced the military operation.

The development worsened an already grim selloff in Asian trade, pushing MSCI’s broadest index of Asia-Pacific shares outside Japan tumbling by more than 3.2%.

Reflecting the mood, Tokyo’s Nikkei opened lower by 2.4%.

U.S. stock market futures were also down sharply with S&P 500 e-minis down by 2.3% while Nasdaq futures was also down by 2.8%.

“The market was always trying to judge if they would stop at Donbass, and it looks pretty clear that they are moving toward Kyiv, which was always one of the worst case scenarios, because we now have a long night ahead of us trying to understand how bad this gets, and what sanctions get put up, because there has to be a fresh round of sanctions now against Putin and the Russian government,” said Chris Weston, head of research at Pepperstone.

“That’s where the worst case, or the bear case scenario is for markets, and that’s what we’re seeing. There are no buyers here for risk, and there are a lot of sellers out there, so this market is getting hit very hard.”

Brent crude futures jumped more than 3.5% and shot past $100 a barrel for the first time since September 2014.

West Texas Intermediate leaped 4.6% to $96.22 per barrel, their highest since August 2014.

Spot gold prices also jumped more than 1.7% to hit its highest level since early January 2021.

The deepening widespread selloff comes in the wake of US stocks taking a beating on Wednesday, with the Dow Jones Industrial Average down by 1.38% to barely above the level that would have confirmed a correction.

The MSCI World Index fell to its lowest level since April 2021.

Geopolitical threats weighed on U.S. yields on pushing down the benchmark U.S. 10-year yield down sharply to 1.8681% from its U.S. close of 1.977% on Wednesday. The 2-year yield also fell, to 1.5% from a close of 1.6%.

Trade in the Russian rouble was choppy: after posting small gains early in the session, it was down nearly 4% on top of a 3% slump against the dollar on Wednesday.

The widespread sell-off also spread to cryptocurrency markets: the price of bitcoin fell below $35,000 for the first time in a month. “Markets are now more adequately pricing in the risk of something horrific happening. That combined with the uncertainty is a horrible environment to be in. No one wants risk exposure when that’s floating around,” said Rob Carnell, head of Asia Pacific research at ING.



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