Stock markets around the world expect a difficult week after Europe and the United States announced on Saturday the blockade of access to the international payment system of Russian banks.
Wall Street futures were in negative territory on Sunday. The indices of the New York Stock Exchange presented declines in their first operations, the biggest drop being that of the technological NASDAQ mini, which lost 2.46%, followed by the S&P 500 mini, which fell 2.24%, and the industrial Dow Jones mini fell 1.43 percent.
The currencies of emerging countries depreciated while stock markets in Asia opened trading lower on Monday, as a response to the new sanctions by the United States and Western countries.
The move to ban some Russian lenders from SWIFT could also have broader effects on global financial markets. The decision could result in late payments and overdrafts within the international banking system and stimulate monetary authorities to revive daily operations to supply the market with dollars, according to Credit Suisse AG strategist Zoltan Pozsar.
Volatility could rise Monday and is already headed for its biggest two-month rise in a year, according to a cross-asset expectations gauge for price moves in Treasuries, U.S. stocks and global currencies.
Treasuries are leading the way, with the MOVE Index of implied volatility jumping to the highest level since the early stages of the Covid-19 pandemic.
According to Bloomberg this week analysts will be attentive to the performance of the ruble against the dollar. Sanctioning Russia’s central bank is likely to have a negative effect on the country’s economy and its banking system, Elina Ribakova, deputy chief economist at the Institute of International Finance, said before the latest round of sanctions was announced.
“This is likely to lead to massive bank runs and dollarization, with a sharp sell-off, reserve outflow and possibly a complete collapse of Russia’s financial system,” he explained.
On Friday, the risk rating agency S&P Global Ratings, reduced Russia’s sovereign credit rating to junk level, which lowered its rating one notch to BB +.
Moody’s Investors Service, which currently has Russia one step above speculative grade, said it was reviewing the nation for a possible downgrade.
These ratings moves came after US and European moves to restrict Russia’s access to global debt markets, but before recent developments involving the central bank and the SWIFT system.
they go out
Norway reported that it will withdraw 1.3 billion dollars that it has invested in Russia, from its sovereign investment fund. This was in response to the invasion in Ukraine.
British oil company British Petroleum (BP) will leave its stake in Russia’s Rosneft, after having operations in Russia for three decades, marking the first condemnation by a company of actions taken by the Russian government against Ukraine.
Stock markets in the United States are down about 8% so far this year, their worst start since 2009, and Russia’s escalating conflict with Ukraine has sparked new concerns on world stock markets.
Although the markets in the United States closed higher on Friday, they are expected to be under pressure starting this Monday.
“Nobody likes uncertainty, investors reject uncertainty and we see the conflict continuing,” said Peter Kinsella, head of strategy at UBP.
I believe, added the specialist, that the way is opening for a new cold war and it is very clear that this feeling will be around for a long time.
Russian military vehicles entered the second largest city in Ukraine and advanced in the largest assault on a European city since the end of World War II.
The United States, the United Kingdom, Europe and Canada pledged on Saturday to withdraw some Russian banks from the SWIFT payment system, deploying what the French economy minister had earlier called a “financial nuclear weapon” for the damage it would cause Russia and Russia. your business partners.
The latest round of sanctions came after the US Treasury Department said it was targeting the “core infrastructure” of the Russian financial system, sanctioning two of its biggest banks: state-backed Sberbank and VTB. . Also on the sanctions list are Otkritie, Sovcombank and Novikombank and some high-ranking executives of state-owned banks.
US banks must sever their correspondent banking ties – which allow banks to make payments to each other and move money around the world – with Russia’s biggest lender, Sberbank, within 30 days.
Washington authorities used the government’s most powerful sanction tool, adding VTB, Otkritie, Novikombank and Sovcombank to the list of Specially Designated Nationals (SDN). The measure expels banks from the US financial system, prohibits them from doing business with Americans and freezes their assets in the United States.
The sanctions also affect two Belarusian state banks – Belinvestbank and Bank Dabrabyt – for the country’s support for the Moscow attack.
The US sanctions came shortly after the British government said it would freeze the assets of major Russian banks and prevent major Russian companies from obtaining financing in the UK.
Russian banks will be excluded from sterling markets and payment clearing, British Prime Minister Boris Johnson has said.
The European Union agreed on Friday to freeze all European assets of Russian President Vladimir Putin and his Foreign Minister Sergei Lavrov, as Ukraine’s leader called for swift and forceful action to punish the invasion of his country.
“It’s a politically important signal,” said a senior EU diplomat, referring to the decision to target Russian leaders.
Earlier on Friday, Ukrainian President Volodymyr Zelensky urged Europe to act more quickly and forcefully in imposing sanctions on Moscow, accusing Western countries of playing politics in the face of Moscow’s advancing forces on Kiev.
“They can still stop this aggression. We have to act quickly,” he said, adding that a ban on Russians entering the EU, Moscow’s exclusion from the global interbank payment system SWIFT and an oil embargo must be on the table.
keep winning
The international oil market was painted green, the prices of references increased. In New York, West Texas Intermediate rose 4.88%, trading at 96.06 dollars a barrel and Brent, from the North Sea, stood at 98.52 greenbacks per unit, an increase of 4.24 percent.
In electronic operations, around 8:00 p.m. in Mexico City, the Mexican currency lost ground against the dollar, selling at 20.5533 pesos per greenback, which against its closing of its last day in which it registered 20.3769 pesos per dollar, reflects a depreciation of 0.87% or 17.64 cents.
The Asian stock markets began their first movements with decreases. In Hong Kong, the Hang Seng fell 0.89%, the Shanghai Composite fell 0.72% and Japan’s Nikkei 225 fell 0.25 percent. The only one that rebounded was the Korean Kospi, with a rise of 012%, to settle at 2,680.04 points.