A Russian invasion of Ukraine would potentially unleash a ‘polar vortex’ on the stock market and push economies into a recession

Morgan Stanley said a potential Russian invasion of Ukraine would pose a significant risk to global equities and send some economies into recession.

“In our view, it materially increases the odds of a polar vortex for the economy and earnings,” strategists, led by Chief Investment Officer Michael Wilson, said in a note published Monday, adding that a surge in energy prices would roil markets.

“Energy stocks could be most at risk for a correction should a potential invasion happen in a way that leads to an oil and nat gas spike,” they said. “Such a spike would destroy demand, in our view, and perhaps tip several economies into an outright recession – the polar vortex.”

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