Growing tensions in Ukraine rattled global markets Monday leading to steep falls in European and US markets in the previous session. Asian markets bucked the trend somewhat overnight, edging higher on regional data though Ukraine woes hampered moves to the upside. Regular pay in Japan increased under 'Abenomics', kicking up the Nikkei225 index while Australia's current account deficit narrowed in Q4 and exports rose.

Asian share markets further stabilised amid reports early Tuesday that Russian President Putin has ordered troops to return to their bases after what Russia called an exercise -- although this was the official line Russia went with, global markets have been anxious that the mobilisation of Russian troops could mean something more serious. Putin is set to speak shortly -- his speech will be carefully dissected by the world. On Monday, market participants dumped risky assets in favour of traditional safe-havens on the prospects of a 'new cold' war, leading to deep falls for the Russian stock market and the Rouble currency.

This morning however, Russian stocks are rallying while the Rouble is on the rebound on news of Russian troops being sent back to their bases; a sign that military action is not imminent although cannot be ruled out between Russian and Ukrainian forces. This has led to risk appetite in Europe to improve too, further helped by a firmer an Asian session although market sentiment remains fragile and anxious at best with traders transfixed with developments in the Ukraine.

The question of economic collapse for Ukraine continues to weigh on sentiment as the country is now in desperate need for funding to service debts -- at the moment, the IMF is in Keiv, negotiating a deal but this will undoubtedly have harsh conditions which are likely to devalue the tightly controlled Hryvnia currency. Looking ahead, other than Ukraine still being the major market focus, attention falls on Europe for PPI data and PMI construction data out of the UK.

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