Asian equities recover as investors wait for the outcome of the Ukraine crisis. However, commodity prices are still high, and traders are concerned about the situation on Europe’s eastern border.

Asian Markets

However, commodity prices are still high, and traders are concerned about the situation on Europe’s eastern border.

On Wednesday, Asian equities held steady and demand for safe-haven assets declined slightly as investors saw Russian troop deployments near Ukraine and early Western penalties as providing leeway to avert a war, while the New Zealand dollar rose due to a rate hike.

However, commodity prices are still high, and traders are concerned about the situation on Europe’s eastern border.

Oil hit a seven-year high overnight as the S&amp 500 index fell more than 10% from its record high in January.[.N]

In early Asia trade, S&P 500 futures were up 0.4 percent after US President Joe Biden kept the door open to diplomacy while announcing sanctions against two Russian banks and some Russian elites close to President Vladimir Putin.

According to Chris Weston, head of research at brokerage Pepperstone, “the market sees the different measures as modest and probably not as harsh as feared.”

For the time being, one may judge that there is a vibe throughout markets that Russian soldiers will retain Donbass but not push any farther, “he continued, referring to the portions of eastern Ukraine that Russia has recognised as independent and reinforced with troops.

The European Union and the United Kingdom also declared intentions to target Russian banks and elites, while Germany delayed Russia’s Nord Stream 2 gas pipeline, causing Europe’s benchmark gas price to jump about 11%.

On Tuesday, wheat futures also leapt on Tuesday, posting the sharpest leap in three-and-a-half years, and corn futures hit an eight-month high on concern that conflict could disrupt grain supply from the Black Sea export region. [GRA/]

Brent crude futures were last steady at $96.74 a barrel, having eased off Tuesday’s high of $99.50. U.S. crude futures sat at $91.92 a barrel.

In short, investors are worried about a stagflationary shock to Europe and, to a lesser degree, the global economy generally, said Shane Oliver, chief economist at AMP Capital in Sydney.

Metals bidding

Investors have been shaken by jitters in Ukraine, which have coincided with rising interest rates as central banks around the world begin to take steps to combat inflation.

On Wednesday, the Reserve Bank of New Zealand announced its third consecutive rate hike, raising the cash rate by 25 basis points to 1%, as expected, but shocking investors with a hawkish tone.

The New Zealand dollar rose 0.6 percent following the announcement, extending its longest winning streak in nearly two years, and New Zealand and Australian bonds were under pressure.

According to a private research company, China is a significant anomaly where rates are falling, with banks in roughly 90 locations this month cutting mortgage rates.

Elsewhere in the currency market, movements were relatively moderate, but hopes of averting a war in Ukraine have snatched some of the bid from safe-haven assets. [FRX/]

The yen was recently trading at 115.00 per dollar, after hitting 114.50 earlier in the day. At $1.1331, the euro was hovering near its 50-day moving average.

The Australian dollar has reached a two-week high of $0.7235, boosted by rising commodity prices.

Due to the holiday in Tokyo, cash Treasuries were closed in Asia, but benchmark 10-year futures remained stable, with an expected yield of 1.96 percent. [US/]

Precious metals have taken a break from their previous highs.

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