Breaking: Russian President Putin to recognise Donetsk and Luhansk in Ukraine's East as independent states

Russian President Vladimir Putin is to sign a decree recognise the breakaway regions of Eastern Ukraine, Donetsk and Luhansk, as independent nations, the Kremlin announced on Monday. Putin had informed the President of France and Chancellor of Germany of his decision shortly before the Kremlin made it official and they were reportedly "dismayed". France has subsequently called for a UN security council meeting on the Ukraine crisis, reported French press. 

Market Reaction

Markets saw a risk-off reaction to confirmation that Russia will recognise the breakaway regions of Ukraine as independent as this is deemed as a big escalation that makes a military confrontation between Ukraine and Russia (i.e. a Russian invasion) significantly more likely. In FX markets, safe-haven currencies including USD and others have been gaining in recent trade while risk-sensitive currencies have been taking a hit. US equity futures continue to press to fresh lows of the day, with S&P 500 futures now down about 1.3% and underneath the 4300 level. Oil prices have been on the front foot with WTI rallying into the mid-$93.00s from as low as the mid-$92.00s just a few minutes ago.