Russia attacks Ukraine: Markets will have to adjust to the shock

Thursday 24 February 2022

Investment Talks

Russia attacks Ukraine: Markets will have to adjust to the shock

February 2022 | Russia’s full-scale attack on Ukraine has led to broad implications for markets. Global markets had not been pricing in a war scenario and are now adjusting to this military move; it will take time for the situation to settle down. In the meantime, uncertainty and volatility will persist, and we are likely to see some excesses to the downside.

01 | This is not a time to try to buy the dip, as the market does not yet fully understand the impact of this geopolitical shock. We suggest investors keep hedges in place, stay cautious, and expect high volatility.

02 | A direct effect of the escalation in the Russia-Ukraine crisis will likely be an increase in energy prices, which will add to inflationary pressures.

03 | China is relatively insulated from the conflict, further reinforcing the role of Chinese assets as a diversifier.

Russia attacks Ukraine: Markets will have to adjust

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