Stocks closed lower today due to more worries about the political climate in Ukraine. The DOW, the S&P 500, and the Nasdap were all down about 2 % this week. The sense of unease is returning to Wall Street lately. The VIX, a key gauge of volatility, and CNN Money’s Fear and Greed Index, which looks at the VIX and six other indicators of market sentiment, have surged 25% and plunged into Fear mode respectively. As you may be aware, investors are waiting for Sunday’s referendum in Crimea, where voters will decide whether they will join Russia or not. The west and Ukraine argue that the vote is illegal and accuse Russia of violating Ukraine’ sovereignty.
Russia benchmark index had its biggest weekly drop in two years, down more than 7%. Also, the Russian currency, ruble, weakened more against the dollar. The Russian markets are under the pressure of the fears of the crisis that may stop the foreign investment. The UN and the EU will also take actions (possibly economic sanctions) against Russia. This is certainly not a good news for Russia’s economy.
Keith Springer of Springer Financial Advisors said that while developments in Ukraine are certainly important there was little else for traders to focus on today. With little in the way of major earnings or economic reports, he said it is “nap season” for investors. No one knows what will happen to the Russia-Ukraine situation, but it is heavily affecting the Wall Street. We will see what path Russia will take, and how it will affect the global economy.