Concerns over Eastern Europe keep volatility high

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As earlier in the day, the market sentiment improved somewhat. Ukraine verified the establishment of the first humanitarian corridor, which facilitated the evacuation of Sumy and Mariupol residents. According to the UN, the overall number of refugees has surpassed two million.

The mood improved considerably after news agencies reported that Ukraine would withdraw its application for NATO membership in an apparent bow to Russia. Meanwhile, the Turkish government has set the next round of peace talks for next Thursday.

President Joe Biden of the United States and Prime Minister Boris Johnson of the United Kingdom have declared sanctions against Russia in response to the country's recent invasion of Ukraine. The first declared the suspension of all crude oil imports from Moscow, including gas and electricity, "after consultation with partners." The embargo on Russian energy is retroactive and extends to all new purchases. As far as the market is concerned, this move has already been anticipated by participants, as it has been making rounds since Monday.

The UK government declared that it would phase out Russian oil and oil products imports by the end of 2022. The goal is to shift slowly enough to allow markets and businesses sufficient time to substitute Russian goods. Additionally, they indicated that their present dependency on Russian natural gas accounts for 4% of supplies and that they are investigating the situation.

Meanwhile, Russian President Vladimir Putin has imposed a moratorium on the export of manufactured goods and raw materials from the Russian federation until December 31.

The EUR/USD pair reached a high of 1.0957 but then settled a few ticks above the 1.0900 level. GBP/USD ended the day battling to hang onto the 1.3100 level. Commodity-linked currencies fell against the dollar. The AUD/USD pair is trading near 0.7270, while the USD/CAD pair is flirting with 1.2900.

Spot gold rose to $2,070.50 per troy ounce before plummeting to approximately $2,031. At the closing, crude oil prices were little altered, with a barrel of WTI changing hands at $123.60.

US indices recovered some ground on Tuesday, finishing with modest gains.

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