Ukraine’s dollar bonds fell 3-5 points on fears about Russian military action against Ukraine. Russia had mobilized about 100,000 troops on Ukraine’s border and threatened “grave consequences” if its push for security guarantees from the US did not succeed, as per FT. Talks have apparently broken down as Russia’s deputy foreign minister Sergei Ryabkov said that discussions hit a “dead end”. “The market has been overweight Ukraine risk — overly sanguine in my view, which made for a brutal wake-up call over the past few days to the risks of escalation in the east,” said Tim Ash of BlueBay Asset Management. Another portfolio manager said that buying Ukraine debt had been a popular trade for foreign for foreign fund managers in recent years and hence they were vulnerable to sell-off in the event of escalating tensions.

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