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  • Writer's pictureanalysiswatch

Title: European Stock Futures Lower; Ukraine Tensions Weigh

Feb 14, 2022 02:10AM ET

By: AnalysisWatch

European stock markets are expected to open lower, continuing last week's sell-off as the threat of war in Ukraine adds to concerns about high inflation and the prospect of interest rate hikes by the US Federal Reserve.

At 2:10 AM ET, the DAX futures contract in Germany was trading 0.5% lower, the CAC 40 futures contract in France was down 2.2%, and the FTSE 100 futures contract in the UK was down 0.1%.

European stocks closed lower on Friday, dragged down by Wall Street on fears that rising inflation in the US would prompt the Federal Reserve to tighten monetary policy aggressively, starting with a 50 basis point hike in March, compounded by a slump in the Michigan Consumer Sentiment Index.

As the standoff enters its most tense week, German Chancellor Olaf Scholz will visit Ukraine later today, followed by a trip to Moscow the next day.

As a result of the rising tensions, oil prices rose to their highest level in more than seven years on Monday, approaching $100 per barrel. Many fear that an invasion of Ukraine would lead to sanctions against the Russian financial system, making it impossible for Western companies to pay for Russian crude exports and forcing them to look elsewhere in the world market.

Russia is one of the world's biggest oil producers, and a disruption in global supply would come just as the Organization of the Petroleum Exporting Countries and its allies, including Russia, are struggling to boost production to meet recovering demand.

At 2:10 AM ET, US crude futures were trading 1.3% higher at $94.31 a barrel, just below their highest since September 2014, while the Brent contract was up 1.2% at $95.52, having earlier hit its highest since October 2014.

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