Europe's stock markets sank Monday after world powers imposed fresh sanctions on Russia over its invasion of Ukraine, while President Vladimir Putin put nuclear forces on a higher alert.

In early deals, London's FTSE 100 index of top companies shed 1.4 percent to 7,384,68 points.

BP's share price slumped 6.0 percent after the British energy giant signalled its exit from Russia.

BP announced Sunday that it will pull its 19.75-percent stake in Rosneft following Russia's assault on Ukraine.

In the eurozone, Frankfurt's DAX index shed 2.1 percent to 14,261.92 points and the Paris CAC 40 dropped 2.6 percent to 6,579.66 points.

"Another crazy start to the week, with the latest sanctions from the West having the teeth that their previous attempts lacked," OANDA analyst Craig Erlam told AFP.

"It's a massive blow for Russia and we are now seeing the consequences of that."

"With the latest sanctions comes uncertainty though which is weighing heavily on risk appetite at the start of the week."

Sentiment was also slammed as Brent oil rebounded back above $100 per barrel, fanning fresh fears of soaring inflation, while the ruble collapsed in value.

"The Russian invasion in Ukraine and the bigger sanctions imposed on Russia take a severe toll on market sentiment," added SwissQuote analyst Ipek Ozkardeskaya.

Oil and safe havens rally, ruble sinks on Russia sanctions
Hong Kong (AFP) Feb 28, 2022 - Oil prices and safe havens surged Monday while the ruble and European equities sank after world powers imposed fresh sanctions on Russia over its invasion of Ukraine, fanning fears about a possible global energy crisis that could further stoke inflation.

Russian President Vladimir Putin's decision to send troops across the border last week has sent shivers through trading floors as investors fret over a protracted war in the resource-rich region.

Adding to the unease among investors was news that Putin had put his nuclear forces on a higher alert in reaction to the latest stiff measures.

Equities rallied Friday and oil dipped as dealers assessed that the punishments imposed on Moscow were light enough to not hit its crucial oil exports -- Russia is the world's third-biggest producer -- at a time when supplies are thin and demand is surging.

But the picture was changed at the weekend, when the United States and European Union said they would exclude some Russian banks from the international bank payments system SWIFT and personally targeted Putin and Foreign Minister Sergei Lavrov.

They also banned all transactions with Russia's central bank, sending the ruble crashing, with Bloomberg saying it was indicated to be nearly 30 percent down in offshore trading Monday. News that the central bank had hiked interest rates to 20 percent -- the highest since 2003 -- helped pared the unit's losses only briefly.

"Removing some Russian banks from SWIFT could result in a disruption of oil supplies as buyers and sellers try to figure out how to navigate the new rules," Andy Lipow, of Lipow Oil Associates in Houston, noted.

Crude surged, with WTI climbing towards the $100 mark, while Brent bounced back above that level after slipping on Friday.

Other commodities rallied, with wheat, aluminium and nickel also sharply higher.

European stocks opened sharply lower, with London off more than one percent while Frankfurt and Paris gave up about two percent.

However, most Asian equity markets recovered from morning selling as traders focus on a planned meeting of Ukraine and Russian officials on the border with Belarus hoping for an easing of the offensive.

Traders will be closely watching a meeting this week of OPEC and other major producers led by Russia, where they will discuss plans for further output.

The group had agreed previously to increase production gradually each month, but the Ukraine crisis could throw those plans into disarray.

Gold and the yen, go-to assets in times of uncertainty, rose, while the dollar was up against all other currencies.

The euro was under pressure owing to Europe's reliance on Russian energy.

The surge in prices is adding to worries about inflation, which is running at a 40-year high in the United States, with central banks already fighting an uphill battle to get it under control.

The conflict is "likely to boost energy prices significantly, resulting in immediate inflationary effects and a large drag on global growth," Silvia Dall'Angelo, senior economist at Federated Hermes, wrote in a note.

"It's fair to say that the crisis increases the room for central banks' policy mistakes."

- Key figures around 0820 GMT -

West Texas Intermediate: UP 4.1 percent at $95.34 per barrel

Brent North Sea crude: UP 3.9 percent at $101.76 per barrel

Tokyo - Nikkei 225: UP 0.2 percent at 26,526.82 (close)

Hong Kong - Hang Seng Index: DOWN 0.2 percent at 22,713.02 (close)

Shanghai - Composite: UP 0.3 percent at 3,462.31 (close)

London - FTSE 100: DOWN 1.1 percent at 7,404.78

Euro/dollar: DOWN at $1.1176 from $1.1271 late Friday

Pound/dollar: DOWN at $1.3363 from $1.3410

Euro/pound: DOWN at 83.62 pence from 84.04 pence

Dollar/yen: DOWN at 115.53 yen from 115.56 yen

New York - Dow: UP 2.5 percent at 34,058.75 (close)

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Markets track Wall St rally as traders weigh Russia sanctions
Hong Kong (AFP) Feb 25, 2022
Equities bounced back Friday from the previous day's rout with investors taking their lead from a rally on Wall Street after Washington decided against imposing the stiffest sanctions on Russia over its invasion of Ukraine. Russian President Vladimir Putin's decision to send troops into Ukraine sent shockwaves through Asian and European markets and pushed oil past $100 for the first time since 2014 as traders contemplated a major conflict in Eastern Europe. Speculation had been growing for weeks ... read more