a year after russia invaded ukraine and set off the bloodiest conflict in europe since world war ii global financial markets seem to no longer carry on the lasting shocks on a daily basis but the full consequences and implications are yet to come said a strategist at deutsche bank us stocks tumbled on feb 24 2022 with the dow jones industrial average djia opening down more than 700 points or 22 while the largecap index sp 500 spx slumped 18 hours after russian president vladimir putin announced the military action meanwhile oil prices rallied with the us benchmark west texas intermediate crude cl00 cl1 clj23 rising to 100 a barrel on the new york mercantile exchange for the first time since 2014 see what russia’s invasion of ukraine means for markets a year later as of friday the dow industrials were slightly lower from a year ago after tumbling for most of 2022 and bouncing off october lows in early 2023 the sp 500 slumped 74 in the past 12 months while the nasdaq dropped 155 according to dow jones market data meanwhile bonds wrapped up their worst year on record in 2022 instead of holding up as stocks tumble almost every type of bond from the us and european government bonds to toprated corporate bonds posted doubledigit losses in the past year a steep us treasury selloff sent yields soaring with the yield on the 2year note tmubmusd02y rising 367 percentage points for the year while the 10year yield tmubmusd10y jumped 233 percentage points the largest on record based on data going back to 1977 according to dow jones market data bond prices and yields move in opposite directions the carnage particularly in us markets came as the federal reserve aggressively ratcheted up interest rates in its effort to calm soaring inflation that had accompanied the recovery from the initial covid shock a series of hikes began in march of last year “with regards to the last year since the ukraine invasion most of the negative bond returns of the last three years have occurred in this period” wrote jim reid a strategist at deutsche bank in a note to clients on friday “the war in ukraine started only a few weeks before the us led the dm developed market global hiking cycle so although the backdrop for the bond selloff was already in place with the extreme covid stimulus it wasn’t until the central banks started hiking that the bond dam broke” in the chart below deutsche bank highlights returns for selected major asset classes over the 12 months since the invasion since february 2022 global investors have pulled a total of 135 billion from bond funds according to analysts at bofa global research citing epfr global data in a weekly note meanwhile investors have allocated 354 billion to cash since russia’s invasion of ukraine equity funds have witnessed a total of 40 billion of inflows and gold has seen 12 billion of outflows said michael hartnett chief investment strategist at bofa global research contrary to what many would have expected given europe’s proximity to the war european equities have outperformed us equities over the past year as investors took money out of us equities to add to their exposure in international stock markets betting european markets could benefit from a weaker dollar the msci euro index mpeh23  which tracks the performance of large and midcap representation across 15 developed markets in europe climbed more than 8 over the past 12 months while the msci usa slumped 72 according to dow jones market data “the dollar has rallied 65 against the euro the european outperformance in local currency terms is even higher the overall outperformance could of course be more to do with a much higher weighting to tech in the us which has underperformed on much higher rates and extreme starting valuations” said reid after rallying for most of 2022 the dollar’s value relative to other currencies had dipped over the past few months as the federal reserve spoke of making progress in bringing down inflation pressures however a flurry of hotterthanexpected january inflation reports helped buoy the greenback and reversed the dollar losses the ice us dollar index dxy jumped 32 to 10520 this month see why us fuel prices continue to feel the effects of russia’s invasion of ukraine meanwhile the us benchmark crude ended friday around 17 below the level seen just ahead of russia’s invasion of ukraine “ironically given the war in europe oil is one of the worst performers over the last year even european gas prices are more than 50 lower than they were a year ago albeit after being up 200 by the end of august” said reid see the real impact of russia’s invasion of ukraine on commodities