K2 Asset Management Managing Director George Boubouras says the geopolitical event revolving around the aborted Russian coup over the weekend amplifies a risk. Mr Boubouras’ remarks come after the Russian ruble over the weekend fell heavily against the US dollar and other currencies amid Wagner Group Chief’s mutiny. “When it comes to Russia through history, don’t play a game of chess with them too openly and never corner them,” Mr Boubouras told Sky News Business Editor Ross Greenwood. “And so those events on the weekend do amplify tensions, impacts markets, commodities, etc, and just makes the inflation issue to address for western economies so much harder.”

Meanwhile, the US and European markets mostly retreated following a brief mutiny in Russia, raising concerns about the stability of the nuclear-armed nation.

Although the Wagner mercenary force, led by Yevgeny Prigozhin, called off their advance before reaching Moscow, analysts believe that the rebellion has exposed President Vladimir Putin’s hold on power as more precarious than previously assumed.

Despite the unease felt on trading floors, European stocks closed with marginal gains and losses, while Wall Street indices concluded a volatile session in a downward trend, particularly affecting prominent technology shares.

Asian markets also experienced declines.

The ruble reached a rate of 85.37 against the dollar, a level not seen since April 2022, shortly after Moscow‘s incursion into Ukraine. However, the Russian currency managed a slight recovery later.

On Monday, Moscow attempted to portray a return to normalcy, with Putin delivering a video speech to a youth engineering forum, commending the industry for surmounting “significant external challenges.”

Equity markets in Europe and the United States largely brushed off the attempted mutiny in Russia over the weekend.

Analyst Michael Hewson from CMC Markets noted, “If there is concern about how events in Russia might play out, the view appears to be let’s worry about it when and if it happens, rather than worry about what might happen.”

“At the start of the week, markets have been adopting a cautious approach,” remarked Tim Waterer, chief market analyst at KCM Trade.

Prior to Prigozhin’s rebellion, traders had already expressed concerns about slowing economic growth in major countries and the potential for further interest rate hikes by Western central banks grappling with high inflation.

The events in Russia have added “an additional layer of uncertainty to the equation,” Waterer explained.

Investors were keeping tabs on comments from Federal Reserve officials, hoping for clarity on their monetary policy plans after boss Jerome Powell last week warned interest rates would likely keep rising.

His comments dealt a blow to hopes the bank had come to the end of its tightening cycle, and came as authorities elsewhere announced further hikes.

There is a growing worry among investors that the tightening cycle around the world could hammer the global economy, with the eurozone already in recession.

A survey Monday showed German business sentiment fell more than expected in June, as the clouds gathered over Europe’s largest economy, also in recession.

The Ifo institute’s confidence barometer, based on a survey of 9000 companies, fell for the second month in a row.

– with AFP