Stocks sink, gas and oil prices soar over Ukraine fears

NEW YORK — Global stock markets fell across the board on Friday and energy prices soared after Russia attacked a major Ukrainian nuclear power plant, the largest in Europe, exacerbated worries about the hit to the continent and its economy.

Europe's main stock markets closed sharply lower, with Paris down five per cent and Frankfurt losing 4.4 per cent.

Earlier, Asian indices had retreated and Wall Street also lost ground to conclude a losing week on a downcast note.

The euro sank close to a two-year low under $1.10 as the Ukraine conflict clouds the eurozone's economic recovery from the coronavirus pandemic.

The greenback benefited from its status as a haven investment.

"Investors have piled out of European stocks this week, accelerating a decline that began at the end of last month, and has accelerated over the last two days," said analyst Michael Hewson at CMC Markets.

"This morning's reckless shelling of a Ukrainian nuclear power plant by Russian forces shows that [President Vladimir] Putin is becoming increasingly desperate to obtain a victory in the face of numerous setbacks," he said.

"These actions are a significant escalation and raise the question as to whether Putin could adopt a scorched earth policy in his attempts to crush Ukrainian resistance," Hewson added.

European and British gas prices surged to record peaks on supply disruption fears as a result of key supplier Russia's ongoing attack on Ukraine.

Oil prices also continued to push higher, with Brent futures ending at $118.11 a barrel, the highest level since 2008.

'Markets ill prepared' 

Ukrainian President Volodymyr Zelensky has demanded still tougher sanctions against his Moscow foes after Russian forces attacked and seized the Zaporizhzhia nuclear power plant, but Kyiv said no radiation leak was detected.

Western countries have hit Russia's economy hard including by closing airspace, freezing assets and excluding seven banks from the SWIFT interbank messaging network.

The impact is already impeding Moscow's ability to shore up the beleaguered ruble and purchase imports.

On Friday, White House spokeswoman Jen Psaki said US officials were "looking at ways to reduce the import of Russian oil while also making sure that we are maintaining the global supply needs out there".

US employers added 678,000 workers to their payrolls in February, government data showed on Friday, driving the unemployment rate down to 3.8 per cent in a monthly report that was better than expected.

"The market is trying to balance the lousy geopolitical situation with the February employment report, which was pretty strong," said Briefing.com analyst Patrick O'Hare.

"What's principally driving the market is this foreboding sense that things are going to get worse before they get better in Ukraine."