(Bloomberg) — Stocks plunged, European shares lost 1% and global bonds rose on concerns about the latest escalation in Russia’s war against Ukraine.
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S&P 500 futures fell 0.5%. The 10-year Treasury yield fell seven basis points to 4.34%. The moves were most pronounced in Europe, with German bond yields falling to the lowest level since October. The euro fell 0.5%. Poland’s main stock index sank 2.6%.
Markets were rocked by news that President Vladimir Putin is pushing a nuclear doctrine that allows Russia to expand the use of atomic weapons, an announcement that comes just days after the United States gave Ukraine limited permission for attacks. with long-range missiles on Russian territory. A report by RBC-Ukraine said the first such attack occurred.
“The market’s reaction is logical, already yesterday you could feel that the tension was increasing,” said Andrea Tueni, sales director at Saxo Banque France. “At the moment, the market reaction is subdued, some are still in wait-and-see mode.”
Traditional safe-haven assets, including the Japanese yen, Swiss franc and gold, gained. Ukraine’s dollar sovereign bonds fell the most among emerging market peers, with bonds maturing in February 2029 losing 1.6 cents on the dollar.
Trump Picks
Also on Tuesday, traders were discussing how Trump’s appointment as Treasury secretary could shape policy. The transition team is considering pairing Kevin Warsh, a former Federal Reserve official, as Treasury secretary, with hedge fund manager Scott Bessent as director of the White House National Economic Council, according to people familiar. with the matter.
“A more measured and experienced team in financial leadership positions in the US government will be positive for investor confidence,” said Rajeev De Mello, global macro portfolio manager at Gama Asset Management.
Meanwhile, Bitcoin is again near an all-time high, surpassing $91,000. The digital asset has been supported by a series of developments that highlight Trump’s deepening adoption of the digital asset industry.
Trump Media & Technology Group Corp. is in talks to buy digital asset marketplace Bakkt Holdings Inc. And Nasdaq Inc. plans to list options on the $43 billion iShares Bitcoin Trust as soon as Tuesday.