NEW YORK- A gauge of global stocks fell and government debt prices rose on Friday after hopes that diplomacy might resolve the Ukraine crisis faded on news Russian-backed separatists were evacuating residents from breakaway regions in the country’s east.
Sentiment soured as shelling increased in eastern Ukraine and a rebel leader announced the surprise evacuation, a surprise development in a conflict the West suspects Russia will use to justify an all-out invasion of its neighbor.
The dollar rebounded and the safe-haven Swiss franc rose as a mood that had improved on news late on Thursday that US Secretary of State Antony Blinken would meet with Russian Foreign Minister Sergei Lavrov next week darkened again.
The dollar index, a measure of the greenback to six major trading currencies, rose 0.301 percent, while the euro against the franc fell 0.19 percent. The two currencies often are recipients of a flight to safety during times of crisis.
The ruble weakened 1.40 percent at 77.16 per dollar as Russian assets have been hammered by fears that a military conflict would trigger sweeping new Western sanctions against Russia.
Germany’s foreign minister, Annalena Baerbock, said all options were on the table regarding sanctions on Russia if it attacks Ukraine, including the Nord Stream 2 pipeline intended to bring Russian gas to Germany.
Investors are waiting for the three-day weekend to be over to assess an equity market already weaker on the outlook that rising interest rates will hurt growth stocks, said Rick Meckler, partner at Cherry Lane Investments.
