The crippling effect of oil prices above $130 would send many European economies into a recession and that sent major European stock indexes
Stocks lower as surging oil prices threaten growth prospects, Kohl’s Investor day disappointment, Oil skyrockets on Russia oil ban talks, Gold nearing record levels, Bitcoin back to being a risky asset – OANDA Q4 2021 hedge fund letters, conferences and more US stocks declined as surging commodity prices continued to add to worry that economic growth prospects will take a big hit as the Ukraine uncertainty persists. The crippling effect of oil prices above $130 would send many European economies into a recession and that sent major European stock indexes into bear market territory. Long-term investors however are growing confident that most of the exposure risk for European banks with the Russia-Ukraine crisis has already been fully priced in and some investors are still hopeful that the war could end diplomatically. The base case however should be that this war won’t end in a month as talks have not provided any meaningful signs of a truce and since Ukrainians have surprised Russia and not given the Kremlin an easy victory. Energy stocks still remain a favorite trade and industrials are not too far behind. It seems the fundamental shift due to Russia’s invasion of Ukraine is that inflationary pressures will remain elevated much longer than expected and that ultimately the economy will fall into a recession at some point over the next 24 months.
