The Paris Stock Exchange reduced its losses after the announcement of a third session of discussions between Russians and Ukrainians, although hopes of progress are almost nil. The market is nonetheless moving to one-year lows, with fears of an embargo on Russian oil imports increasing the risk of an inflationary shock. A prospect reinforced by the surge in other raw materials, from palladium to cereals, of which Russia is one of the main world exporters. The V2X index, which measures underlying volatility on the Euro Stoxx 500 index, crossed the 50 point mark for the first time since March 2020 to peak at 59.48.
Around 2:45 p.m., the Bedroom 40 fell 0.71% to 6,018.41 points after a low of 5,756.38, unseen since March 5, 2021. However, the index is close to a “bear market” situation with a fall of nearly 20% from compared to its record of January 5. Trading volumes are particularly high with 4.1 billion euros traded on the values of the flagship index. The contracts future on US indices fell around 0.6%.
Towards a barrel at more than 150 dollars?
A barrel of North Sea Brent crude jumped 4% to $122.92 after touching 139.13, its highest level since July 2008, which represents an increase of about 18% from Friday’s closing level . US Secretary of State Antony Blinken said the United States was in talks with its European allies to block imports of Russian oil. Democratic Speaker of the House of Representatives Nancy Pelosi is considering passing a law banning imports of Russian oil into the United States. Such a decision would mark a turning point, as Western countries have so far avoided cutting themselves off from Russian gas and oil. European countries would be strongly impacted by such a decision insofar as Russia represents approximately 30% of the oil supplies of the Old Continent, against 3% for the United States.
” Cutting off from Russian oil will put further upward pressure on crude prices and could propel the price per barrel above $150 in the near future warns Ipek Ozkardeskaya, analyst at Swissquote. And to add that ” the continued rally in oil and commodities should push European economies to ration their consumption and weigh on economic recovery and corporate results in 2022 “.
Gas prices for their part reached a new record in Amsterdam at 345 euros per megawatt-hour before returning to around 280 euros, an increase of 45%.
Exclusive Networks boosted by cybersecurity needs
This surge in prices and the increase in the price of kerosene weigh on airlines as Air France-KLM, down 5%. Heavily exposed to Russia, Alstom down 3.3%. Conversely, the manufacturer of seamless tubes Vallourec lead of 8.4% and the defense electronics group Thales gained 6.2%, thus signing the strongest rise within the Cac 40, ahead of Dassault Systems (+2.9%). Biggest rise in SRD, Exclusive Networks jumped 14%, the specialist in the distribution of cybersecurity software being boosted by the explosion of needs in the field.
Moscow announced a provisional ceasefire from 10 a.m. local time and the opening of humanitarian corridors around the cities of Kiev, Kharkiv, Mariupol and Sumy to allow the evacuation of civilian populations. Ukrainian President Volodymyr Zelensky called on NATO forces this weekend to impose a no-fly zone on its territory in order to prevent Russian aircraft from continuing their bombardments. NATO refuses to do so and Vladimir Putin has warned that such an option would be likened to an act of war.
More and more companies have decided to suspend their operations in Russia, this is notably the case of Visa, Mastercard, American Express or Netflix. Danone (-1.4%) for its part announced the suspension of all its investment projects in the country, where the French agri-food group has been established for a long time.
Kering lost 1.6% after announcing the temporary closure of its stores in Russia due to the situation in Ukraine. Chanel also announced the suspension of its activities.
Gold hits $2,000
In this context of high uncertainty, safe havens are playing their role, gold crossed the threshold of 2,000 dollars per ounce for the first time since August 2020, the Swiss franc briefly rose above the parity of 1 for 1 with the euro for the first time since 2015.
Investors are preparing for a long-lasting conflict in Ukraine and strong repercussions for the global economy, placing central banks in a dilemma between inflationary pressures, due to the boom in raw materials, and the risk of stemming the growth in the event of too sharp a rise in interest rates. The ECB, which is meeting its Governing Council on Thursday, should be patient in its plan to reduce support measures and could even adopt new ones, according to analysts at Capital Economics, particularly in the form of capital injections. liquidity to banks in a context of restrictions imposed on Russia.