Global: Specific factors for Ukraine risk

While the markets are going through the most volatile sequence of recent times, we observe that geopolitical concerns continue to be on the axis.

While the markets are going through the most volatile sequence of recent times, we observe that geopolitical concerns continue to be on the axis. The tension of the possibility of war is compelling for the markets, and at the same time, there are concerns that it may cause a harder landing for the world at a stage where it is difficult to determine a policy after the pandemic plus the global inflation crisis. There are risk factors to be evaluated at different layers in a wide range from energy flow to financial system embargoes.

 

The United States is preparing 8,500 troops to support NATO forces in Eastern Europe. However, soldiers will not be sent to Ukraine at this stage. The United States and Europe have threatened new sanctions if Russia invades Ukraine. Russia's military buildup on the Ukrainian border, as well as its exercises in the Baltic and the Indian Ocean (here with Iran and China) show that the parties are currently in the process of moving pawns, knights, bishops, whatever we call them, on the chessboard.

 

Market risks, on the other hand, are based on my geopolitical income and economic situation risks. The largest exchange-traded fund tracking Russian equities has seen its biggest cash injection in more than a year. However, it is stated that this is not a bullish signal, on the contrary, it may be a short selling herald. Such a move could be triggered in a possible invasion of Ukraine. I will detail the event with a separate analysis during the day.

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