Dow Jones plummets as Putin’s war sends shockwaves through global economy

Ukraine: Sirens sound in Kiev as Russia begins invasion

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In what stands as Europe’s biggest attack since World War Two, the Kremlin’s escalation of the conflict with the West has led to stocks falling sharply — with the Dow Jones Industrial Average dropping 700 points or 2.2 percent — as global energy prices surge and investors desperately look for the safety of fixed-income assets.

As Moscow launched an assault on its neighbour, crossing its borders and bombing targets near the country’s big cities, the markets felt the force of war.

While the Dow is about 12 percent off its record, the S&P 500 was down 1.7 percent as the benchmark slipped further into correction territory and the index sits nearly 14 percent away from its January 3 record close.

The Nasdaq Composite declined 1.6 percent and the Nasdaq 100 opened in bear market territory, down more than 20 percent from its high in November 2021.

The longstanding diplomatic crisis between Russia and the West has turned into a full-scale military conflict, and Vladimir Putin’s claims his country has no plans to occupy Ukrainian territories, only “demilitarise” them, have anything but prevented markets from turning upside down.

The Russian president, whose Army has for months massed more than 100,000 troops near Ukraine’s borders, has all along insisted there were no malign intentions from Moscow’s end – that security guarantees to safeguard their own safety were everything the Kremlin was after.

FACT-CHECK: Why are Russia and Ukraine at war?

His words, in which some leaders trusted at least to a certain extent, on Thursday lost the little value they still had left.

Moments after a pre-dawn TV statement in which Mr Putin emphasised once again an occupation of Ukraine was not on the cards and demanded Kiev’s military lay down their arms, attacks were reported on Ukrainian service targets.

About 10 civilians are already believed to have been killed, including six in an airstrike in Brovary, near the capital, which has a population of almost three million.

A Ukrainian presidential adviser said more than 40 soldiers had died and dozens more were wounded while a man was also killed in shelling outside the major eastern city of Kharkiv.

Kiev said it had killed 50 Russian troops and shot down six Russian aircraft. This, however, has not been verified.

Ukraine President Volodymyr Zelensky urged people to stay calm, saying in a video statement: “No panic. We’re strong. We’re ready for anything. We’ll defeat everyone – because we are Ukraine.”

But those watching from outside are less optimistic than the President.

The pan-European Stoxx 600 dropped more than three percent, reaching its lowest point of 2021, and the VanEck Russia ETF, a US-traded security that invests in top Russian companies, fell roughly 16 perecnt.

Bitcoin is getting battered, too, most recently down 6.5 percent.

Apple lost four percent on Thursday; Bank of America and JPMorgan Chase were down more than 4.5 percent each, and Tesla was five percent lower.

Decades-high inflation deriving from the coronavirus pandemic is now suffering a blow by the trouble brought by Mr Putin.

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Ukraine: Zelenskyy speaks Russian in plea to spread information

Hours before the Kremlin’s attack, Mr Zelensky made a last-ditch plea for peace asking Russian people — in Russian — to stop their government from sending troops across the border and into his country.

In an emotional speech, he warned them “the start of a big war on the European continent” was in question.

In an attempt to connect with a population blinded by state-controlled Russian media, he tried to tell them the picture they have been painted, one of a Ukraine run by Nazis who threaten Moscow, is far from reality.

He said: “The Ukraine on your news and Ukraine in real life are two.

“You are told that we are Nazis. How could a people that lost more than eight million people in the fight against Nazism support Nazism?”

Only days ago, the president had cautioned against panic and overreaction to the Kremlin’s provocations while the US, EU and UK raised the alarm over what they thought was to come in Eastern Europe.

But after Mr Putin announced the recognition of breakaway territories Donetsk and Luhansk as independent entities and ordered troops into the two regions on Monday, Mr Zelensky’s bearing transformed.

And on Wednesday, his tone changed drastically.

He told the Russian people: “Many of you have been to Ukraine. Many of you have relatives in Ukraine. Some have studied in Ukrainian universities. Some have made friends with Ukrainians. You know our character. You know our people. You know our principles.

“The people of Ukraine want peace.

“The government of Ukraine wants peace.”

Yet, he also made clear what Kiev’s response would be in case of further incursions, claiming: “We know for sure we do not need a war – not a cold one, not a hot one, not a hybrid one.

“But if these forces attack us, if you attempt to take away our country, our freedom, our lives, the lives of our children, we will defend ourselves. Not attack – defend.”

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