NEW YORK: Oil prices rose while most leading global stock markets also climbed to conclude a positive week for equities despite the growing toll of Russia’s attack on Ukraine and central bank moves to counter inflation.
After trading in negative territory most of the day, European stock markets turned higher at the close, shrugging off concerns about aggressive monetary tightening by different central banks around the world, sky-high inflation and soaring commodity prices.
Wall Street stocks also began the day in the red, but quickly turned positive and finished solidly higher. The broad-based S&P 500 finished up 1.2 percent for the day and more than six percent for the week.
Analysts say the surge on Wall Street reflected bargain hunting after a grim start to the week.
“No one is going to step in front of the train,” Briefing.com analyst Patrick O’Hare said.
“It’s undeniably a really good week,” he said, adding that he nonetheless expects more volatility ahead.
But OANDA analyst Craig Erlam suggested that “an unhealthy amount of complacency (could be) creeping into the markets”.
“The rebound we’ve seen over the last couple of weeks has been nothing short of extraordinary,” Erlam said.
The IMF, World Bank and other top world lenders, for their part, warned of “extensive” economic fallout from the war in Ukraine and expressed “horror” at the “devastating human catastrophe.”
“The entire global economy will feel the effects of the crisis through slower growth, trade disruptions and steeper inflation,” the institutions — including the European Bank for Reconstruction and Development — wrote in a joint statement.
Warning that the world could face the “biggest oil supply shock in decades,” the International Energy Agency (IEA) called on governments to urgently implement measures to cut global crude consumption within months.
The IEA also urged OPEC+, the group of oil producers led by Russia and Saudi Arabia, to act to “relieve the strain” on the markets at their next meeting.
But for investors, the overriding question were further developments in the war.
US President Joe Biden warned Chinese leader Xi Jinping of the “consequences” for any backing of Russia in its war against Ukraine, the White House said following a two-hour meeting between the heads of state.
Chinese state television CCTV reported that Xi said the war was “in no one’s interest” and that “state-to-state relations cannot go to the stage of military hostilities.”
However, there was no direct Chinese criticism of the Kremlin.
Russia’s lead negotiator Vladimir Medinsky said that Moscow and Kyiv had brought their positions “as close as possible” on a proposal for Ukraine to become a neutral state.
But Mikhailo Podolyak, an advisor to Ukraine’s President Volodymyr Zelensky taking part in the negotiations, said his country’s position had not budged.
“The statements of the Russian side are only their requesting positions,” he wrote on Twitter.
“All statements are intended, inter alia, to provoke tension in the media. Our positions are unchanged. Ceasefire, withdrawal of troops & strong security guarantees with concrete formulas.”
Oil prices continued to rise further above $100 a barrel.