MOSCOW, April 14 (Prime/RIA Novosti) – Leading European stock indices slipped into the red on Monday morning as investors grew increasingly reluctant to buy risky assets due to rising tensions in Ukraine.
“There was hope that the tension would peak with Crimea rejoining Russia, but new epicenters of pro-Russian rhetoric are rising in the east, and the authorities in Kiev, it seems, will soon run out of patience and diplomatic means of settling the conflict,” a Capital Spreads trader told Reuters.
By early Monday afternoon, the German DAX had fallen by 0.89 percent, the French CAC 40 by 0.91 percent and London's FTSE 100 by 0.70 percent.
The pressure on the European exchanges sprung from tensions in eastern Ukraine. The situation escalated over the weekend after Kiev authorities announced a large-scale security operation involving the army to reclaim government buildings seized by pro-federalization protesters in several cities of Donetsk Region.
Traders warned that the action may signal the beginning of a more serious conflict, risking long-term geopolitical stability.
Russian markets shed several percentage points to the move away from risky assets as well. The ruble and Moscow's main stock exchange dropped about 1 and 1.5 percent, respectively, as the country's cost of insurance against default hit a new high.
The key concern for investors is the ongoing talk of further sanctions, whereby the opposing political sides could end up imposing tough measures that will inevitably harm all European economies.
