Potential for Ukraine and Russian Negotiations drives a market rebound

The global markets had a strong night of trading on the back of renewed peace talks between Russia and Ukraine. Equity indices were up, whilst commodities took a breather from their recent highs. Reports coming out of Europe indicated that Ukrainian President Volodymyr Zelensky has cooled off on the prospect of Ukraine joining NATO and is open to discussing Russia’s demand for neutrality. This may pave the way out of the conflict to which the market reacted positively.

The US market had a strong night pulling back some of the previous losses. The Nasdaq closed 3.59% higher and the Dow Jones finished 2.00% higher. The S&P 500 also closed up 2.57%. In Europe the DAX had a large rise moving up 7.92%. The FTSE also performed well finishing up 3.25%.

Commodities dropped overnight as Oil took a breather with Brent Crude sliding 12% to less than $110 a barrel, its steepest decline in two years.  The UAE’s ambassador to the UN outlined plans to increase oil production and has encouraged OPEC to also increase supply. Gold also dipped, falling back below $2000 an ounce. Benchmark wheat futures were down 6.6% after soaring to a multiyear high the day before. Wheat prices are still up 50% from the start of the year. Russia and Ukraine also issued warnings over the potential disruptions to gas supplies in western Europe with neither side willing to claim responsibility which may impact gas prices going forward.

Bitcoin had a strong day with the BTC/USD climbing 7.93%. Ethereum also had a nice rise with ETH/USD rising by 4.36% on the back of the more positive sentiment and move back to higher risk investments.

FOREX

Along with commodity prices, the USD was also down against most major currencies. The EUR performed strongly against the USD rising 1.64%. The GBP/USD also performed well, rising 0.58%. The AUD/USD and the NZD/USD also performed strongly and continue their recent uptrend up 0.73% and 0.55% respectively.

All eyes will be on the CPI figures being announced later today. Some analysts believe that February’s inflation has likely accelerated and is far from peaking. With the recent rise in oil and gas prices, these will likely be priced into the figures for March and April. Some analysts believe that CPI will rise to 0.8% after rising 0.6% the prior month. The Federal Reserve is still expected to hike interest rates 25 basis points later this month.