European markets lurched after Ukraine used long-range US missiles to attack deep inside Russia for the first time and the Kremlin announced an updated nuclear-weapons doctrine. Polish stocks and the zloty currency led a wider transatlantic selloff as investors used the Eastern European country’s assets as a proxy for escalating risk. Traditional haven assets including the Japanese yen, Swiss franc and gold gained. Ukraine launched ATACMS missiles at a military facility in the Bryansk region, according to a statement by Russia’s Defense Ministry. Shortly before confirming the missile strike, the Kremlin released an updated doctrine which potentially allows the use of nuclear weapons in response to conventional attacks. The rapid escalation of the conflict, now past its 1,000th day, caught G-20 leaders meeting in Brazil off guard. Despite the growing sense of international disorder, leaders at the summit left concern over the latest escalation out of their communique. Follow our live blog.
Key European countries may need to double defense spending to meet the challenge of Russia’s aggression in Ukraine as well as the possibility of less American support in a Donald Trump presidency, according to a Bloomberg Intelligence report. The 15 largest European members of the North Atlantic Treaty Organization might have to ramp up military investment by as much as $340 billion annually to $720 billion.
