Governmental conflicts have never benefited anyone and the same is on the horizon with the Russia-Ukraine war. Some might believe that the conflict is between two countries and won’t affect the rest of the world but unfortunately, the reality is far from it. Russia’s attack on Ukraine jolted energy and financial markets of the world, forcing oil prices to skyrocket and financial assets to plummet when Russian forces advanced in Ukraine and caused havoc.
The global financial markets are under analyst scrutiny to capture any possible changes. Graphene FX reviews the situation at hand and after detailed research, has answers to how the conflict might or have already impacted the global markets.
Starting from European countries to other continents such as Asia and Africa, the anxiety caused by the war culminated when President Vladimir Putin pulled the deceit of his opponents and other world leaders and launched a major military campaign by entering Ukraine.
And throughout the international and financial sectors, the world economy was unsettled, inflicting shareholders unparalleled damages. Forex and crypto markets that operate day and night were the very first victims of the Russian invasion.
With the Ukraine situation ramping up, Brent oil hit the $100 benchmark and Asia-Pacific equities slumped over fears regarding interruption in supply and restrictions. Gold, which is considered a safe haven commodity in uncertain times, increased 1% and last traded at $1,932 just as Russian President Vladimir Putin claimed in a public speech that he has sanctioned military intervention in Ukraine, and NBC Media reported bombs were observed in Kyiv. Financial markets in Japan, Hong Kong, S Korea, and Australia dropped down up to 3%. Dow Jones sank 1.38% and Nasdaq dropped 2.6% the previous Wednesday.
Russia’s currency ruble also plummeted overnight, dropping to a historic low of 89.986/dollar, although rebounding a bit after a little while. The euro was at $1.1196 and dropped to $1.1106 on Thursday. Since May 2020, this new value was the lowest it reached. The pound and the Australian dollar were also battered as the U.S. dollar in exchange lost strength on the yen and Swiss franc.
As the international markets crumbled, bitcoins, one of the hallmark cryptocurrencies, dropped roughly 10% within a few hours, resulting in the settlement of over $72 million long bets during the day. The whole cryptocurrency prospective position holders suffered $242 million to selloffs as meme and altcoins dropped from 10% to 35% in a wild slide.
Financial markets throughout the globe could not dodge the massacre with Moscow Stock Exchange, as predicted, leading the losers’ chart, since over 50% of capitalization was destroyed from asset dumping hysteria around European countries and the remaining countries.
Russia and Ukraine are at the core of international turmoil, and they both are the major exporters of wheat. They contribute to around 25% of the worldwide supply of the product.
Currently, there are worries that the costs of the product will soar up in the following months as the area grows progressively ‘trim off from the entire world. Analysts claimed this might aggravate Kenya’s soaring food costs.
Churning far less than the 1.8 million bbls a day prediction in the 2022 utilization, increasing crude oil valuation, that should have offered an income bonanza of an additional $43 upon each barrel from the $62 per oil barrel originally envisioned in the 2022 financial report, presently raises new challenges for Kenya.
Financial analysts suggested investors should remain involved if they are a part of any long-term investment plans and mutual fund clients should maintain their SIP plans without abandoning the investment. However, the significant downturn will present a chance to investors to take up high-quality securities at favorable prices and they should keep an eye out for such stocks for maximum profits.
If the Ukraine conflict intensifies severely in the coming days, the financial markets are likely to take another battering since oil prices are predicted to continue at a high level. While the US Reserve Bank is also convening next month to make decisions on raising interest rates and restricting liquidity, there are indications that the Fed will not go over for a dramatic rise or restrictions.