S&P 500 Futures, Nikkei 225 stay depressed, US T-bond yields extend recovery amid Ukraine crisis

• Risk appetite remains sluggish amid indecision over Ukraine-Russia moves, Western sanctions.
• Supply crunch fears propel commodity prices, Antipodeans of late.
• S&P 500 Futures, Nikkei 225 remain near multi-day bottom, US Treasury yields keeps bounce off two-month low.

Having witnessed a volatile start to the week, global investors stay cautious during early Tuesday amid a soft coverage on Russia-Ukraine macro, as well as a light calendar. Though, the risk-off mood remains on the table amid escalating woes over the supply chain and inflation.

While portraying the sentiment, the US 10-year Treasury yields extend the previous day’s rebound from two-month to 1.76% up 1.5 basis points at the latest. However, Japan’s Nikkei 225 drops 0.60% by the press time whereas the S&P 500 Futures decline 0.15% intraday at the latest.

The Western sanctions on Russia and the military invasion of Ukraine are the key causes for the market’s latest supply crunch woes.

Headlines from Reuters indicate no major progress in the peace talks between Ukraine and Russia even as the human corridor is up for a restart. “Ukrainian officials said a Russian airstrike hit a bread factory in northern Ukraine on Monday, killing at least 13 civilians, while talks between Kyiv and Moscow made little progress towards easing the conflict,” said the news.

Even so, the UK and the EU’s resistance to fully ban the oil imports from Russia, as widely pushed by the US, joins the World Bank’s (WB) humanitarian aid to Kyiv to ease the previous risk-off mood.

That said, the gold prices rallied to a 19-month high whereas WTI crude oil rallied to the levels last seen during 2008 the previous day. Also cheering the supply fears are the nickel buyers as the metal refreshed an all-time high of around $50,550 on the London Metal Exchange (LME).

Looking forward, updates concerning Ukraine and Russia will join the supply-chain related headlines to direct short-term market moves. Also important will be Thursday’s US Consumer Price Index (CPI).

Read: What inflation reports are you trading this week?