Markets rattled by prospect of Russia/Ukraine war

“The prospect of war is rarely good for stock markets, and so the new trading week has begun on a bad note across Europe and Asia as investors fear the alarm clock is about to sound on a physical battle between Russia and Ukraine,” says Danni Hewson, Financial Analyst at AJ Bell.

“The FTSE 100 was down 1.8%, erasing nearly all the gains year to date; the Nikkei fell 2.2% and the Dax slumped 2.6%.

“Should Russia go to war with Ukraine, there is no telling how long the battle will last, and the damage wrought on the stock market.

“Uncertainty is terrible for investors, and it will take real nerve to stay invested through war, particularly as news headlines are likely to cause panic on the markets. Yet patience has historically been rewarded as time in the markets is better than timing the markets.

“In the UK, the retail sector was braced for another setback with value seller Studio Retail getting ready to go into administration. It has failed to secure a short-term loan and it now looks as if a buyer will be sought for the business.

“Mike Ashley’s Frasers Group is the biggest shareholder in Studio Retail with a 28.89% position and his tactic has often been to wait until a retailer goes into administration before pouncing with a cut-price deal. He’s a shrewd operator and would rather wait until a company is on its final breath before coming in with a lifesaving offer.”

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