{"id":433,"date":"2022-03-01T19:28:52","date_gmt":"2022-03-01T19:28:52","guid":{"rendered":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/?p=433"},"modified":"2022-03-02T19:18:03","modified_gmt":"2022-03-02T19:18:03","slug":"what-does-the-ukraine-crisis-mean-for-markets","status":"publish","type":"post","link":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/2022\/03\/01\/what-does-the-ukraine-crisis-mean-for-markets\/","title":{"rendered":"What does the Ukraine Crisis Mean for Markets?"},"content":{"rendered":"<h2>What does the Ukraine Crisis Mean for Markets?<\/h2>\n<p>&nbsp;<\/p>\n<p>Brock Melnyk &#8211; March 1st, 2022<\/p>\n<p>As I believe most of you know, I am of Ukrainian decent. My paternal grandfather emigrated from Ukraine in the late 1930s prior to WWII.\u00a0The tragedy and and loss of life from war is beyond description. It is difficult to comprehend the effect this will have on the citizens of Ukraine and their families around the world. The humanitarian impact cannot be understated and my heart goes out to everyone affected.<\/p>\n<p>History shows us that while concerns about financial markets and the global economy are appropriate, the reality is that geopolitical crisis such as Russia invading Ukraine do not typically have long-term consequences for investors. Russia&#8217;s economy is the 11th largest in the world according to the International Monetary Fund, and is only 1\/20th the size of the US and 1\/15th the size of China, so in itself is not large enough to affect global economic growth, even if significant sanctions are levied against it by the US and other Western Nations.<\/p>\n<p>In their most recent Viewpoint Fidelity Investments (the worlds fourth largest asset manager with assets under administration of $11.1 Trillion) summarized some key takeaways including:<\/p>\n<ul>\n<li>The conflict between Russia and Ukraine may contribute to increased short-term market volatility<\/li>\n<li>Disruption of Russian energy exports as result of the conflict could temporarily contribute to rises in global energy prices<\/li>\n<\/ul>\n<p>From an investment standpoint, the biggest impact will be negative market sentiment on Russian stocks, bonds and currency. Higher oil and gas prices could further benefit North American Energy Companies, whose stocks have been among the best performers over the past year.<\/p>\n<p>This is where the guidance of a financial advisor is important so short term risks are managed with the pursuit of long term goals in mind. History suggests that patient investors are likely to be rewarded with the lift from current extreme levels of negative market sentiment.<\/p>\n<p>The chart below from Ryan Detrick, Chief Market Strategist at LPL Financial, highlights that unless there is a global recession, stock markets tend to recover and have positive performance for the 12 months after the event:<\/p>\n<p><a href=\"https:\/\/twitter.com\/RyanDetrick\/status\/1496837865078239237\/photo\/1\"><img fetchpriority=\"high\" decoding=\"async\" class=\"wp-image-436 aligncenter\" src=\"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-300x221.jpg\" alt=\"\" width=\"672\" height=\"495\" srcset=\"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-300x221.jpg 300w, https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-1024x753.jpg 1024w, https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-768x565.jpg 768w, https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-1536x1130.jpg 1536w, https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-content\/uploads\/sites\/109\/2022\/03\/Stocks-after-Major-Events-2048x1507.jpg 2048w\" sizes=\"(max-width: 672px) 100vw, 672px\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<p>For the remainder of 2022 it is important to remember the two main drivers of market performance will be:<\/p>\n<ol>\n<li>US Federal Reserve Monetary Policy (how fast will they raise rates)<\/li>\n<li>Company Earnings and Revenue Growth as we exit the Covid-19 Pandemic<\/li>\n<\/ol>\n<p>There will be numerous other events that will be center focus in the media for periods of time. As we have been suggesting for some time, 2022 is looking to be a volatile year, one which prudent investment strategies will be important..<\/p>\n<p>If you want to read more about the Russian Invasion I recommend <a href=\"https:\/\/bmailer.link\/t\/c\/d76a6e0a-be35-47b3-a11d-f9c629b8d94e\/017f08aa-abf3-ae84-c34f-628571fb2a59\">this article<\/a> from Ian Bremmer, President of the Eurasia Group; or this <a href=\"https:\/\/bmailer.link\/t\/c\/948cc5df-749f-49fa-9736-829b13dbf61a\/017f08aa-abf3-ae84-c34f-628571fb2a59\">Complete Visual Guide to the Ukraine-Russia Crisis<\/a> in The Guardian. If you are feeling sympathetic to the Ukrainian cause, or just want to learn more about the history between Russia and Ukraine, I recommend you watch <a href=\"https:\/\/bmailer.link\/t\/c\/8b44238b-5553-42c7-aee1-ee101ff9ae65\/017f08aa-abf3-ae84-c34f-628571fb2a59\">Winter on Fire: Ukraine&#8217;s Fight for Freedom<\/a> on Netflix.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p style=\"text-align: left\">Sources: Ian Bremmer, <a href=\"https:\/\/bmailer.link\/t\/c\/8dbae449-5809-400b-ac67-1c7f2a4dd5dc\/017f08aa-abf3-ae84-c34f-628571fb2a59\">What Actually Mattered This Week<\/a>, February 25th, 2022; Fidelity investments, <a href=\"https:\/\/bmailer.link\/t\/c\/be1de58d-cdcc-44be-9024-99f39f3b8fc3\/017f08aa-abf3-ae84-c34f-628571fb2a59\">What the does the Ukraine Crisis Mean for Markets?<\/a>, February 22, 2022; ADV Ratings, <a href=\"https:\/\/bmailer.link\/t\/c\/29d5ff63-0b89-4dbe-a808-4a1a646cbf75\/017f08aa-abf3-ae84-c34f-628571fb2a59\">Fidelity Investments<\/a>; September 20th, 2021; The Guardian; <a href=\"https:\/\/bmailer.link\/t\/c\/30c973c1-dce0-48be-8c9a-887cd5687a09\/017f08aa-abf3-ae84-c34f-628571fb2a59\">Russia&#8217;s War in Ukraine<\/a>, February 28th, 2022<\/p>\n<p style=\"text-align: left\">The information contained herein has been provided for information purposes only.\u00a0 The information has been drawn from sources believed to be reliable.\u00a0 Graphs, charts and other numbers are used for illustrative purposes only and do not reflect future values or future performance of any investment.\u00a0 The information does not provide financial, legal, tax or investment advice.\u00a0 Particular investment, tax, or trading strategies should be evaluated relative to each individual\u2019s objectives and risk tolerance.\u00a0 This does not constitute a recommendation or solicitation to buy or sell securities of any kind. Market conditions may change which may impact the information contained in this document. \u00a0Wellington-Altus Private Wealth Inc. (WAPW) does not guarantee the accuracy or completeness of the information contained herein, nor does WAPW assume any liability for any loss that may result from the reliance by any person upon any such information or opinions.\u00a0 Before acting on any of the above, please contact your financial advisor.\u00a0 WAPW is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.<\/p>\n<p style=\"text-align: center\">\u00a9 2022, Wellington-Altus Private Wealth Inc.\u00a0 ALL RIGHTS RESERVED.\u00a0 NO USE OR REPRODUCTION WITHOUT PERMISSION.<a href=\"https:\/\/bmailer.link\/t\/c\/9709df77-581b-4906-9bc9-a2a1e4d2e84c\/017f08aa-abf3-ae84-c34f-628571fb2a59\">www.wellington-altus.ca<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>What does the Ukraine Crisis Mean for Markets? &nbsp; Brock Melnyk &#8211; March 1st, 2022 As I believe most of you know, I am of Ukrainian decent. My paternal grandfather emigrated from Ukraine in the late 1930s prior to WWII.\u00a0The tragedy and and loss of life from war is beyond description. It is difficult to [&hellip;]<\/p>\n","protected":false},"author":135,"featured_media":429,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_oasis_is_in_workflow":0,"_oasis_original":0,"_oasis_task_priority":"","_exactmetrics_skip_tracking":false,"footnotes":""},"categories":[14],"tags":[],"class_list":["post-433","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-market-commentary"],"_links":{"self":[{"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/posts\/433","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/users\/135"}],"replies":[{"embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/comments?post=433"}],"version-history":[{"count":3,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/posts\/433\/revisions"}],"predecessor-version":[{"id":441,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/posts\/433\/revisions\/441"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/media\/429"}],"wp:attachment":[{"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/media?parent=433"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/categories?post=433"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/melnykwealthmanagement\/wp-json\/wp\/v2\/tags?post=433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}