In a piece of latest news, global stocks plunge following Russia’s military attack on Ukraine. The stock plunge has drawn condemnation from the West and makes punishing sanctions all but certain.
On 24 Feb 2022, European stocks stumbled. The FTSE 100 fell 3% in London, while France’s CAC 40 dropped by 4.6% and Germany’s DAX 30 shed 5%. While Russia’s stocks crashed, the country’s main index dropped 45% before recovering some losses.
Dropping Situation in West and Asia
Meanwhile, in Asia, Hong Kong’s Hang Seng Index (HSI) dropped 3.2%—accounting its biggest daily loss in 5 months. On the other hand, Japan’s Nikkei (N225) lost 1.8% and China’s Shanghai Composite moved 1.7% lower.
While in the US, stocks futures also tumbled. Dow futures were down 750 points, or 2.3%. S&P 500 and Nasdaq futures were down 2.2% and 2.8% respectively.
The pain goes beyond the Global stocks plunge. The Russian ruble briefly crashed about 10% to a record low of 90 against the US Dollar. The world benchmark, Brent Crude, topped $100 a barrel for the first time since 2014 on its way to $104.50 per barrel. US crude jumped 7.5% to $98.91 a barrel.
Russian Attack on Ukraine
On Thursday morning, Ukrainian people woke up to military attacks and explosions. A broad offensive by Russian forces targeted military infrastructure across Ukraine as well as several airports. The assault began hours before dawn and quickly spread across central and eastern Ukraine as Russian forces attacked from three sides. Putin warned of bloodshed unless Ukrainian forces lay down their arms.
Analysts for ING wrote in a research note, “The world is shocked as Russia launches a major military offensive against Ukraine. Financial markets are predictably witnessing a flight to safety and may have to price in slower growth on the further spike in energy prices.”
Investors will watch for the West’s response to Russia’s aggression, which is likely to include punishing sanctions. The ING analysts further added, “The question will then be which Russian financial institutions are targeted for severe financial sanctions.”