Oil prices extended gains Tuesday on
the prospect of further sanctions on Russia for alleged “atrocities” in some
occupied Ukraine cities, while equities struggled to build on a rally in New
York and Europe.

European Union officials were discussing new measures against Moscow after
reports — denied by the Kremlin — that troops had executed civilians.

Among the punishments could be a ban on imports of Russian crude,
following a similar move by the United States and Britain.

White House National Security Advisor Jake Sullivan also signalled more US
sanctions were on the way this week.

While Europe’s economy relies heavily on energy from Russia, the
possibility of an embargo sent both main contracts sharply higher Monday, and
they continued their rise in Asia, putting on more than one percent.

That pared some of the sharp losses seen Friday in reaction to a pledge by
Washington and other major economies to unleash millions of barrels from
their stockpiles to keep a lid on prices, which are fanning already high
inflation.

It also offset an expected hit to demand in China from lockdowns in parts
of the country — including Shanghai, the biggest city — sparked by a wave
of Omicron outbreaks.

The continued uncertainty caused by the war in Ukraine, and the blow to
the global economy it is expected to deal, was unable to prevent another
healthy performance on Wall Street, where the Nasdaq’s surge led all three
main indexes higher.

“Despite all the concerns, equities remain the best bet to achieve returns
above today’s elevated inflation,” said markets strategist Louis Navellier.

However, trade was tepid in Asia, with Hong Kong, Shanghai and Taipei
closed for holidays.

Tokyo, Sydney, Singapore, Jakarta and Wellington were slightly up, while
Seoul and Manila dropped.

Traders will be keeping a close eye on the release this week of minutes
from the Federal Reserve’s most recent policy meeting, hoping for an insight
into officials’ thinking over monetary policy.

After last month’s expected 0.25 percentage point interest rate hike,
there are increasing bets on a half-point lift in May in light of soaring
inflation and strong jobs data that suggest the economy remains robust enough
to absorb higher borrowing costs.

And National Australia Bank’s Tapas Strickland added: “Profit reporting
season in the US kicks off next week and it will be interesting to see how
firms are interpreting the tea leaves, and whether earnings guidance is
revised down.”

– Key figures around 0200 GMT –

Tokyo – Nikkei 225: UP 0.1 percent at 27,756.54

Hong Kong – Hang Seng Index: Closed for a holiday

Shanghai – Composite: Closed for a holiday

Brent North Sea crude: UP 1.7 percent at $109.31 per barrel

West Texas Intermediate: UP 1.7 percent at $105.00 per barrel

Euro/dollar: DOWN at $1.0969 from $1.0978 late Monday

Pound/dollar: UP at $1.3117 from $1.3114

Euro/pound: DOWN at 83.62 pence from 83.65 pence

Dollar/yen: DOWN at 122.60 yen from 122.78 yen

New York – Dow: UP 0.3 percent at 34,921.88 (close)

London – FTSE 100: UP 0.3 percent at 7,558.92 (close)