Markets brace for headwinds, inflationary shocks as Ukraine-Russia crisis looms

EQUITY markets will not escape from the tensions building in Ukraine, and investors should brace themselves for rude shocks in the form of inflation spikes and increased volatility.

The situation took a turn for the worse on Monday (Feb 21) after Russia President Vladimir Putin recognised 2 breakaway regions in eastern Ukraine as independent entities. This brought with it threats of new sanctions and fears of a major war.

In simple terms, there is no way this could end smoothly for financial markets around the world, and investors should best stay away from risks, market watchers said.