Global markets stabilize as Russian invasion threat continues
Global markets stabilized on Friday after the threat of a potential Russian invasion of Ukraine propelled the Dow to its worst day of 2022.
Australia’s S&P/ASX 200 and Japan’s benchmark Nikkei (N225) closed down 1% and 0.4%, respectively, while South Korea’s Kospi (KOSPI) was little changed.
Chinese markets were mixed. As the benchmark Shanghai Composite (SHCOMP) Index gained 0.7%, Hong Kong’s Hang Seng Index (HSI) dropped 1.9%.
US futures pointed up slightly on Friday, with Dow futures, S&P 500 futures and Nasdaq futures rising 0.6%, 0.7% and 0.8%, respectively.
Market watchers are nervous about what a military conflict between Russia and Ukraine could mean for oil prices and the global economy, especially if the United States and major economies in Europe become involved.
Investors detest uncertainty. A full-blown invasion of Ukraine would trigger a knee-jerk selloff in stocks as businesses confront the possibility of an oil shock, higher inflation and a sanctions regime.
A prolonged market downturn would wipe out wealth built up by families in the stock market and in retirement accounts. Market instability could also dent confidence among consumers and businesses.