Ukraine crisis: Russia’s attack boosts commodities and shipping lines, while bank stocks, airlines and chip makers get hammered
- Asia’s commodity and shipping stocks are emerging as safer bets given concerns about shortages of raw materials as Russia is a major exporter
- Strategists at Goldman Sachs Group advocate a rotation to commodity-heavy Australia and recommend being overweight on the energy sector
So far, Asia’s commodity and shipping stocks are emerging as safer bets given concerns about shortages of raw materials as Russia is a major exporter. Strategists at Goldman Sachs Group advocate a rotation to commodity-heavy Australia and recommend being overweight on the energy sector.
Meanwhile, shares of companies that get a chunk of their revenue from Russia, such as Japan Tobacco, are at risk of lower profits. The longer-term ripple effects will also be more complex: higher costs of basic goods will continue to squeeze consumers, limiting spending power. It also hurts margins for firms that are unable to pass on costs.
Acknowledging the fast-evolving situation, here’s a look at Asian shares that are affected by the Russia-Ukraine conflict.
Raw material prices traded higher following the invasion, with the Bloomberg Commodity Index touching 2014 highs this week. In Asia, energy and oil producers continued a rally that started last year given economies reopening following the pandemic. Australia’s Woodside Petroleum and Santos, for example, outperformed the broader MSCI Asia Pacific benchmark, which slid about 4 per cent this week. In Malaysia, Dialog Group was up 1.8 per cent.
