Market Commentary | The week that was

The latest news on the Russia-Ukraine conflict is that diplomatic talks have been stepped up in an effort to end the war. This follows an agreement between Ukrainian and Russian negotiators to resume talks after making ‘progress’ in previous talks. According to Reuters (13 March 2022) an estimated 14,000 deaths and 1,900 casualties have been reported since Russia’s invasion of Ukraine on 24 February. More concerning news is that Russia has requested military equipment from China. This could severely undermine the rest of the world’s efforts to end the conflict.

Meanwhile the Ukrainian war has also affected the gold price: “Gold hit an all-time high last week, breaking above $2 070 an ounce, following the US ban on Russian oil and other imports in response to its Ukraine invasion,” reported Moneyweb (14 March 2022). “We saw a four-fold increase in demand for physical gold this last month,” says Hilton Davies, founder of SA Bullion.

Locally, the South African tourism industry has received a blow as one of the leading airline companies, Comair, has been grounded indefinitely. Comair, which operates flights by British Airways and Kulula, failed to convince the SA Civil Aviation Authority (SACAA) that it meets all the necessary safety requirements. The company’s operating license was suspended on Sunday 13 March, cancelling all upcoming flights, and leaving many passengers around the country stranded.

Looking at the week ahead investor focus will remain on the conflict in Ukraine & the US Federal Reserve’s meeting as they are expected to increase interest rates.