The key indices of the US stock market - Dow Jones, NASDAQ, and S&P 500 - ended Monday with growth and generally continue to be near the highs of last week. Last week, we already said that the latest stock market growth does not look too logical. The fact is that such a strong growth should have been accompanied by some important positive news or events that do not exist and did not exist. First of all, positive ones. Perhaps the US market reacted this way to the withdrawal of Russian troops from Kyiv and Chernihiv, but at the same time, the withdrawal of troops from some regions of Ukraine does not mean that the military operation is over, and now you can breathe freely. Full-scale military operations are continuing in the Kharkiv, Donetsk, Luhansk, and Mykolaiv regions. Thus, it seems to us that the growth of the US stock market is a reaction to a temporary pause and a temporary weakening of the confrontation between Moscow and Kyiv.
It is already absolutely clear to everyone that negotiations between Ukraine and the Russian Federation will lead to nothing. At least in the near future. As stated in the Kremlin, no one is going to give up Crimea and Donbas. As stated in Kyiv, Donbas and Crimea is Ukrainian territory, and there will be no concessions on these territories. And this means that military actions will continue, and sanctions will continue to be imposed against Russia. In principle, now that the flywheel of the sanctions war has already been launched, it remains only to wait for the moment when all possible sanctions will be imposed. Many international companies have already left Russia, more than 6,000 sanctions have been imposed, the gold and foreign exchange reserves of the Central Bank of the Russian Federation have been frozen, and 7 commercial and state banks have been disconnected from the SWIFT system. At the moment, the issue of imposing a full embargo on oil, gas, and coal from the Russian Federation is on the agenda in the European Union. This issue should be resolved by the end of this week.
Meanwhile, some EU countries did not wait for the official decision of the EU authorities. Lithuania, Latvia, Poland, and Estonia have decided to completely close any communication with Russia and Belarus, and prohibit the transit of any goods to Russia/Belarus or from these countries on their territory. The countries also decided to abandon purchases of energy resources from Russia after the UK. According to representatives of these countries, their energy consumption volumes are not too large, and they can easily replace Russian hydrocarbons. Now it's the turn of the entire European Union, in which Germany, Austria, and Hungary oppose the embargo. If the appropriate decision is made, the markets may experience a new shock.