The DAX is trading at 9560, up 2% as the prospect of a war between Ukraine and Russia seems less likely. Russia wants to protect its citizens that are living in eastern Ukraine but will only use force as a ‘last resort’.
European stocks were sent tumbling yesterday when Russian troops were deployed to Ukraine, but now that things are heading in a more diplomatic direction, traders are buying back in. The US secretary of state John Kerry has arrived in Ukraine; the US has already warned Russia that a war would be a mistake.
Market volatility has dipped today but this does not mean it could not return. The uncertainty that comes with war would push equities lower, but I think diplomacy will prevail and the situation will be solved in a non-violent manner.
Carrying on from Brenda Kelly’s article, since we have broken through the 9500 level we could head towards the 9592 level with the 50-daily moving average of 9519 acting as support.
The market gapped lower on Monday; when that gap is filled, we will stand a better chance of retesting the 9720 highs of 24 February.