Barclays: If Russia-Ukraine ceasefire talks make substantial progress, European energy prices and interest rates are expected to fall, and the German market may see a valuation re-rating.
Barclays reports that the Russia-Ukraine situation is a potential upside catalyst for European markets. Should credible progress be made in ceasefire negotiations, energy prices, inflationary pressures, and geopolitical risk premiums could simultaneously retreat. This would lead to a decline in European bond yields, providing a dual tailwind for European equities, with the German market potentially showing particular resilience.
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