Markets continued to grapple with the economic and corporate earnings implications relating to the Russia-Ukraine conflict. âWe have a ton of uncertainty right now,â said Stephanie Link, chief investment strategist and portfolio manager at Hightower Advisors. âWeâre dealing with a war, weâre dealing with inflation. We donât know what it means to earnings.â And indeed, volatility has been a hallmark of the market environment so far in 2022, with the S&P 500 still down more than 10% for the year-to-date after first sliding into a correction last month. The CBOE Volatility Index, or VIX, has held at a lofty level of more than 30. There was another possible development: Reuters also reported that Ukraine said that Belarus could soon join the invasion of Ukraine. However, the AFP, citing a Pentagon official, said the U.S. hasnât yet seen evidence that Belarusian troops are in Ukraine. "The inflation fire was already hot and now with war-driven inflation added to the mix, it will grow even hotter, setting off a scramble by the worldâs central banks to pull back their stimulus earlier than expected," Chris Rupkey, chief economist at FWDBONDS, wrote in an email. "A spike in inflation rates has preceded economic recessions historically and this time prices have soared to levels that once again pose a threat to growth." He adds: "Telegram has become my primary news source."
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