The escalation of the conflict between Ukraine and Russia led to a heavy trading and financial day around the world, after Kiev and Moscow did not reach a ceasefire, which led to a sharp drop in the main stock markets and a marked increase in commodities and cybersecurity stocks for fear of renewed cyberattacks.
Thus, the largest stock markets once again felt the impact of the conflict in Ukraine, and European floors ended in red: Paris and Milan respectively lost 1.39%; Frankfurt, 0.73% and London, 0.42%, while in Madrid, the drop was slighter, 0.09%.
In New York, the Dow Jones industrial average lost 0.5% this Monday, the expanded S&P 500 index fell 0.5% on the daywhile the Nasdaq technology indicator rose 0.4% today, according to data provided by the New York Stock Exchange (NYSE).
Oil ended the session more expensive than at the openingafter negotiators from both sides of the conflict in Eastern Europe were unable to reach a cessation of hostilities that includes artillery exchanges on civilian targets.
The barrel of the WTI variety closed this Monday with a rise of 4.6% and was agreed at 96.80 dollars, while the Brent type climbed 3.1% today and was traded at 101 dollars.
The impact of the conflict was also felt strongly in the grain market. Grains rose across the board in Chicago, pushing soybeans back above $600 a ton to finish at $604 for March deliveries and wheat to $340, up more than 10% from Friday closing.
The financial sanctions imposed by Western countries on Russian assets, funds, companies and banks and especially on Moscow accounts in the international payment system Society for Worldwide Interbank Financial Telecommunication (SWIFT), practically left the Kremlin on the brink of isolation and financial collapse.
This decision led to the suspension of trading in Moscow and a severe collapse of the Russian currency, the ruble, which fell 25% closing at 105 units per dollar.
Difficulties in the supply of energy from Russia increased the price of crude oil that accumulates a rise of almost 30% since the beginning of 2022.
In any case, the escalation of the conflict led several oil companies such as the Dutch Shell and the British BP to abandon their projects and businesses in Russia.
It will be necessary to see what happens with other companies such as Exxon, which has businesses and holdings in common with the Russian Rosneft, or companies such as Halliburton with a high exposure in Russia.
Even with everything, the market awaits with expectation the meeting in which, On Tuesday, the OPEC+ oil cartel will have to decide whether to increase its production to try to moderate crude oil prices.
Saudi Arabia, the main oil producing country, has already anticipated that it will be inclined to maintain the increase in supply at around 400,000 barrels per day, something that is considered insufficient for importing countries.
In response, consuming countries have said they will pour a new portion of their world strategic oil reserves back onto the market.
The fear of a prolongation of the conflict and a new interruption in the supply of inputs also boosted the demand for metals.
By the end of the day, it was clear that stocks were the least interesting place for investors.
On both sides of the Atlantic, the losses were accounted for either by the high exposure of banks and companies to Russia or by fears that the rebound achieved after the pandemic will fade and the rise in energy prices will end up fueling inflation around the world and this forces central banks to adjust their interest rates more quickly, further cooling economies around the planet.
At the end of the day and given the lack of agreement between Kiev and Moscow and the fear of a new escalation of the conflict, the fear of computer attacks on key facilities and infrastructure began to feed, within a new and sophisticated combat mechanism in modern wars.
Thus, papers linked to cybersecurity gained interest and appetite from investors who saw an opportunity to position themselves with very low prices on very high-tech companies with high market capitalization, as a sort of hedge, in the face of a potential and prolonged conflict. and to avoid recording further losses in their portfolios.
