Yahoo Finance Global stocks fall as Biden says Russian invasion could happen in next 'several days'
European stocks were sharply lower on Thursday after US intelligence officials said that Russia’s claims that it is withdrawing troops along its border with Ukraine are false.
In London, the FTSE 100 (^FTSE) fell deeper into the red in the afternoon, closing 0.9% down, while the French CAC (^FCHI) was 0.4% lower, and the DAX (^GDAXI) slipped 0.8% in Germany.
The recent reports reignited jitters among investors as the US said that Moscow has actually increased its military presence along the border by as many as 7,000 troops in the past several days.
US president Joe Biden also told reporters that a Russian invasion could happen in the next “several days”. He described the chance of conflict in the region as “very high.”
Russia-backed rebels have also accused Ukrainian forces of shelling their territory in violation of agreements aimed at ending conflict in the contested Donbass area – something Ukraine denied later.
"With the Russians saying one thing, and NATO and the US pushing back, saying that Russian troop numbers are rising near the Ukraine border, and that no de-escalation appears to be happening, markets are increasingly becoming susceptible to headline risk," Michael Hewson of CMC Markets said.
"This means the phoney war is likely to continue until such time as Russia either de-escalates or decides to push into Ukraine."
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Across the pond, the S&P 500 (^GSPC) dipped 1.2% and the tech-heavy Nasdaq (^IXIC) fell 1.5%. The Dow Jones (^DJI) edged 1.2% at the time of the European close.
It came as the number of Americans filing new claims for unemployment benefit rose last week to 248,000, an increase of 23,000 on the previous seven days. This was more than economists had expected, but still close to pre-pandemic levels.
The US is currently facing an acute shortage of workers, and a record number of vacancies has encouraged companies to hold onto their staff.
Meanwhile, US housing starts declined for first time in four months. Residential starts dropped 4.1% last month to 1.64 million, falling below expectations. Applications to build, which indicate future construction, rose to 1.9 million.
The figures highlight the impact of labour shortages, which have slowed the recent recovery in building activity.
On Wednesday Federal Reserve policymakers indicated that they are leaning towards more decisive action on inflation but set no firm targets.
Analysts are widely expecting that rates will rise in March, however markets are currently split between whether the Fed will move by 25bps, or by 50bps.
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Asian stock markets mostly followed Wall Street higher on Thursday. The Hang Seng (^HSI) rose 0.3% in Hong Kong while the Shanghai Composite (000001.SS) ended the day 0.1% higher.
The Kospi (^KS11) in Seoul advanced 0.5% after the government reported that the economy added 1.1 million jobs last month, and the unemployment rate edged lower.
However, in Tokyo the Nikkei (^N225) fell 0.8% after January exports rose by a weaker-than-expected 9.6% in Japan, compared to a year earlier.
Oil prices (BZ=F) which have been volatile due to anxiety over a potential Russian invasion of Ukraine, fell by nearly $2 per barrel.
Watch: Ukraine-Russia crisis: West 'blinked' over troop deployment and sanctions will push Russia towards China
