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Tension In Ukraine Shocks Markets; Uncertainty Persists
By: Ong Qiuying
Articles (131) Profile

Ukraine hit markets hard as tanks and warships threatened the global markets in the Crimean showdown. The crisis escalated further after Crimea’s parliament voted to join Russia and proposed a referendum, which would violate the Ukrainian constitution and international law. Developments in Ukraine will likely remain in close eye.

In US, the Beige Book reported upbeat business contacts even as a “snowmaggedon” has been blamed for the slower economic growth in the country. Weekly jobless claims declined to 323,000, the lowest in 3 months. Meanwhile, the European Central Bank (ECB) upped 2014 growth forecast to 1.2%, amidst ongoing recovery although risks remained to the downside.

Closer to home, China’s top officials began the 10-day National People’s Congress and announced plans to raise its defence budget by 12.2% and a growth target of 7.5% in 2014. The modest projection suggests that the Chinese leaders are continuing to focus on growth in gross domestic product but also beginning to prioritise economic sustainability.

Securities trading on the Singapore Exchange recorded a fall of 35% to $20.9b in Feb, amidst the global uncertainties and regulators’ tougher measures on trading. Daily average value of trading fell 41% to $1b. Amongst the actives, a large transaction is brewing for Noble Group as sources say COFCO Corp is in talks to buy its agri-business arm that will value the division at US$1b.

Despite the uncertainty, it seems that weather-related woes would not dampen the taper course in US as Fed noted that it will take a major change in economic outlook to alter its plans. The Fed’s policy-setting committee will meet on 18-19 Mar.

Qiuying oversees the construction and real estate investment trusts sectors at Shares Investment.

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