Global stocks rose and safe-haven trading slumped on Tuesday amid optimism that geopolitical tensions in Ukraine could be easing. US futures rose after Russia will announce that it will return some of its military forces to their bases after exercises that raised alarm about a possible military attack on its neighbor.
In New York, the Nasdaq advanced 2.5%, while the S&P 500 rose 1.6% and the Dow Jones Industrial gained 1.2%. In Europe, the indicator Euro Stoxx 50 rose 1.95%, the CAC 40 1.86% and the DAX 1.98%. While the Energy stocks underperformed in Europe as oil retreated to $93 (-3.6%) from the highest level since 2014 reached on Monday and the prices of natural gas fell before a possible cooling of the crisis. Treasury yields advanced while the dollar and gold fell. The ruble, the Russian currency, jumped.
Asia fell short of picking up the good news and the Nikkei ended down 0.79% and the Hang Seng with a drop of 0.82%.
Diplomatic efforts continue to try to de-escalate the Ukraine crisis, with German Chancellor Olaf Scholz set to meet Russian President Vladimir Putin. While US officials have warned that a Russian invasion may be imminent, Moscow has repeatedly denied that it is planned.
Markets have been battered this week as the crisis added to existing concerns about high inflation and the withdrawal of stimulus by the Federal Reserve. Investors’ focus today will be on producer price inflation figures for clues as to how aggressive the Fed is likely to be with reining in its monetary policy.
“What we’re seeing is a Fed that is reacting to inflationary impressions even though a lot of the pressures on inflation are factors that the Fed can’t really figure out,” Kristina Hooper, chief global market strategist at Invesco, said on Bloomberg Television. “So that certainly increases risks and reduces clarity. “.