Markets react to fear of war

The few serene ones are likely to quote the President of Ukraine these days. Volodymyr Oleksandrovych Zelensky calls on "Western partners" to provide him with evidence of an allegedly imminent "Russian seizure" - he has no information about a "deep conflict". He warns against war panic emanating from the mass media.

Meanwhile, U.S. President Joe Biden spoke Sunday with his Ukrainian counterpart and said Washington would respond "swiftly and aggressively" to any Russian military action - according to a White House statement. Pessimists see this as a kind of announcement of an event triggering war and point to Swiss historian and publicist Daniele Ganser, who never tires of emphasizing in his lectures that all U.S. wars since the Vietnam War have been justified by lies.

The markets, however, are not detached, but only pessimistic. Oil prices rose to a new seven-year high and European and Asian stocks fell Monday - shortly after more warnings from U.S. officials of an imminent Russian attack on Ukraine.

The regional Stoxx Europe 600 Index fell 1.9 percent in early trading, while the U.K.'s FTSE 100 slipped 1.2 percent. Russia's Moex stock index fell 2.6 percent to its lowest level since late January.

The latest volatility in global stock markets, which have fallen this year as central banks tighten monetary policy, came as German Chancellor Olaf Scholz prepared for a trip to Moscow to try to dissuade Vladimir Putin from invading Ukraine.

Scholz's latest attempt comes at a time when Western countries are withdrawing diplomatic and military personnel from Ukraine and some European countries are preparing for an influx of refugees in the event of military action.

Energy prices rose on Monday as investors focused on the latest developments in Ukraine. Brent crude, the international benchmark, rose as much as 1.8 percent to $96.16 a barrel, its highest level since September 2014 and up about 23 percent since the start of the year.

European natural gas contracts for delivery next month rose 12 percent to 83.41 euros per megawatt-hour.

European bonds rallied as traders sought protection in lower-risk assets.

Germany's benchmark 10-year Bund yield, which has surged in recent weeks on the prospect of the European Central Bank scaling back pandemic stimulus, fell 0.05 percentage point to 0.24 percent. The corresponding U.K. gilt yield fell 0.06 percentage point to 1.49 percent.

How the theater between the U.S., Ukraine and Russia ends remains to be seen. However, the markets seem to have already made up their minds.