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Ukraine crisis sets up DAX for worst week since June 2012
March 14, 2014 / 8:12 AM / 4 years ago

Ukraine crisis sets up DAX for worst week since June 2012

LONDON, March 14 (Reuters) - European shares fell on Friday, setting up Germany’s DAX index for its worst weekly loss since June 2012 as investors grew increasingly worried about the threat of war in Ukraine and jitters in the Chinese credit market.

At 0807 GMT, the pan-European FTSEurofirst 300 index was down 0.6 percent at 1,285.08 points, while Germany’s DAX was down 0.9 percent and Britain’s FTSE 0.4 percent.

The DAX was down 4.4 percent for the week, on course for its biggest weekly fall in nearly two years. The FTSE’s 2.7 percent weekly fall is the steepest since June 2013.

Investors have been spooked by an increase in tensions between Russia and the West over Ukraine and mixed data from China, where authorities are putting pressure on banks to reduce lending to troubled industries.

Assets which depend on economic growth, such as stocks, were under pressure while perceived safe havens, such as gold and U.S. Treasuries, rose as Russia showed no sign of backing down on plans to annex Ukraine’s Crimea region despite a stronger than expected drive for sanctions from the EU and United States.

Investors were reluctant to open new long positions in stocks ahead of the weekend, when Crimean residents will vote on whether they want their region to join Russia or remain part of Ukraine.

“I‘m short the whole lot (of European equity indexes),” Alex Chehade, senior dealer at spreadbetter Tradenext, said. “I‘m long bonds and gold - there’s a real flight to safety here.”

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