Global stocks fall, oil rises in volatile trading after Russia’s oil ban

NEW YORK, March 8 (Reuters) – Global stock markets fell on Tuesday as oil prices climbed further, pushed by the United States’ ban on Russian oil and other energy imports following Moscow’s invasion of Ukraine.

US President Joe Biden made the announcement on Tuesday, while Britain said it would phase out imports of Russian oil and petroleum products by the end of 2022. read more

Benchmark Brent crude for May hit an intraday high of $131.27 a barrel before settling at $127.98 a barrel, up 3.9%, while futures on the US crude CLc1 settled at $123.70 a barrel, an increase of 3.60%. Read more

Russia, which ships 7 to 8 million barrels a day of crude and fuel to world markets, has been the target of Western sanctions since its February 24 invasion of Ukraine. nL2N2VA28Q]

Russia calls its actions a ‘special operation’ and said earlier this week that prices could soar to $300 a barrel and that it could close the main gas pipeline to Germany if the West blocks its oil exports . Read more

Jason McMann, head of geopolitical risk analysis at Morning Consult, called the US ban remarkable, but said the “real show” would be Europe’s ban on Russian energy imports.

“Given Europe’s relatively high dependence on energy supplies from Russia, such a move, if materialized, would have major economic and geopolitical ramifications,” he said.

The news added to market volatility and stoked fears of rising inflation as European and other economies cooled.

The MSCI World Equity Index (.MIWD00000PUS), which tracks stocks from 50 countries, fell 0.59% at 3:50 p.m. ET (2050 GMT).

The Dow Jones Industrial Average (.DJI) fell 83.05 points, or 0.25%, to 32,734.33, the S&P 500 (.SPX) lost 16.03 points, or 0.38%, to 4,185.06 and the Nasdaq Composite (.IXIC) added 8.70 points, or 0.07%, to 12,839.66. The STOXX 600 was down 0.51% (.STOXX).

Solita Marcelli, chief investment officer for the Americas for UBS’s wealth management arm, said the rise in oil prices over the past week – the second biggest jump in 30 years – is expected to continue, resulting in continued market volatility.

“The Russian-Ukrainian war has pushed oil prices up faster than expected, but we continue to see a tight supply-demand balance for crude oil around the world, even as hostilities end and the geopolitical risk premium attached to crude is decreasing,” Marcelli said. noted.

Gold extended its rally to a record high on Tuesday after investors flocked to the traditional safe-haven metal amid growing fears around the Russia-Ukraine crisis. Spot gold prices rose 2.6% to $2,049.31 an ounce.

The London Metal Exchange (LME) halted nickel trading on Tuesday after prices doubled in hours to a record $100,000 a tonne, fueled by a race to cover short positions. Read more

UBS Global Wealth Management recommended a neutral stance on equities and advised clients to hold commodities, energy stocks and the US dollar as short-term portfolio hedges.

The rally in oil and other commodities has heightened investor fears about global inflation. Data this week is expected to show that the US consumer price index climbed 7.9% year on year in February, from 7.5% in January. Read more

Germany’s benchmark government bond yield rose sharply and a gauge of long-term eurozone market inflation expectations hit its highest level since late 2013.

The 10-year US Treasury yield was 1.8594%.

The euro rose 0.47% to $1.0903, after falling 3% last week to its lowest level since mid-2020.

The dollar index fell 0.112%.

Reporting by Elizabeth Dilts Marshall; additional reporting by Saikat Chatterjee, Elizabeth Howcroft, Sujata Rao and Julie Zhu; Editing by Jonathan Oatis, Alexander Smith and Mark Heinrich

Our standards: The Thomson Reuters Trust Principles.