Wall Street opened two percent lower on February 24, following a global drop in markets after Russia's attack on Ukraine while crude oil prices surged past $100 a barrel.
At the time of writing this report, Dow Jones Industrial Average was trading over 2 percent or 665 points lower at 32,467.08 levels while S&P 500 was down 1.51 percent at 4,161.53 points. The tech-heavy Nasdaq, on the other hand, traded 1.71 percent or 222 points lower at 12,815.11 levels.
In the commodity markets, benchmark Brent crude prices topped $100/barrel-mark for the first time since 2014 as Russia launched invasion of Ukraine. During the day, Brent crude oil futures hit a high of $105.5.
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Russia’s action comes days after the country recognised the independence of two separatist regions in Easter Ukraine following a speech by Putin.
Financial markets across the globe took a heavy beating given the geopolitical situation. Indian equity market nosedived nearly 5 percent to register its biggest single-day fall in nearly two years. European markets sank even more, with the German DAX down 5%.
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Oil prices jumped by more than $7 per barrel and futures for Wall Street's benchmark S&P 500 index and the Dow Jones Industrial Average were off by more than 2.5%. Market benchmarks in Europe and Asia fell as much as 5% as traders tried to figure out how large Putin's incursion would be and the scale of Western retaliation.
Energy prices surged, fuelling inflation fears. The spot price in Europe for natural gas, for which the continent relies on Russia to supply, jumped as much as 31%. Benchmark US crude was close behind at $99 per barrel. Prices of wheat and corn also jumped.
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The ruble sank as much as 7.5% against the dollar overnight but recovered slightly, down about 5% in the morning.
The FTSE 100 in London fell 3.3% after Europe awakened to news of explosions in the Ukrainian capital of Kyiv, the major city of Kharkiv and other areas. The DAX in Frankfurt plunged 5.4% and the CAC in Paris lost 4.9%.
Moscow's stock exchange briefly suspended trading on all its markets on Thursday morning. After trading resumed, the ruble-denominated MOEX stock index tumbled more than 20% and the dollar-denominated RTS index plunged by more than a third.
That was on top of Wednesday's 1.8% slide for the S&P 500 to an eight-month low after the Kremlin said rebels in eastern Ukraine had asked for military assistance. Moscow had sent soldiers to some rebel-held areas after recognizing them as independent.
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Some analysts expect the conflict to push investors out of many tech stocks, with the exception of the cybersecurity sector. Growing concern that massive cyber warfare could be on the near-term horizon which would certainly catalyze an increase in spending around preventing sophisticated Russian-based cyber attacks, analysts with Wedbush Securities wrote in a note to clients.
Putin said Russia had to protect civilians in eastern Ukraine, a claim Washington had predicted he would make to justify an invasion. President Joe Biden denounced the attack as unprovoked and unjustified" and said Moscow would be held accountable, which many took to mean Washington and its allies would impose additional sanctions.
Putin accused them of ignoring Russia's demand to prevent Ukraine from joining NATO and to offer Moscow security guarantees. Washington, Britain, Japan and the EU earlier imposed sanctions on Russian banks, officials and business leaders. Additional options include barring Russia from the global system for bank transactions.
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The price for oil on international markets rose to $101.27, while West Texas Intermediate soared $7.65 to $99.75 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 25 cents to $92.10 on Wednesday. In Asia, the Nikkei 225 in Tokyo fell 1.8% to 25,970.82 and the Hang Seng in Hong Kong lost 3.2% to 22,901.56.
The Shanghai Composite Index shed 1.7% to 3,429.96. Asian economies face lower risks than Europe does, but those that need imported oil might be hit by higher prices if Russian supplies are disrupted, forecasters say.
The Kospi in Seoul lost 2.6% to 2,648.80 and Sydney's S&P-ASX 200 fell 3% to 6,990.60. India's Sensex fell 4.7% to 54,529.91. New Zealand lost 3.3% and Southeast Asian markets also fell.
Investors already were uneasy about the possible impact of the Federal Reserve's plans to try to cool inflation by withdrawing ultra-low interest rates and other stimulus that boosted share prices. The dollar weakened to 114.69 yen from Wednesday's 114.98 yen. The euro fell to $1.1168 from $1.1306.