Stock markets mostly rose and oil prices fell Wednesday as economic sanctions imposed on Moscow over the Russia-Ukraine crisis were deemed less harsh than expected.
Brent crude stood at $93.50 per barrel, having soared to a seven-year high of $99.50 Tuesday on fears of disruptions to key Russian oil supplies.
"Market mood is not cheerful but the softer-than-feared sanctions somewhat help," SwissQuote analyst Ipek Ozkardeskaya noted Wednesday.
Trading floors remain on edge, with Ukraine mobilising its military reserve and urging its citizens to leave Russian territory as Moscow sharpened its demands, increasing fears of all-out war.
Russian President Vladimir Putin has defied an avalanche of international sanctions to put his forces on stand-by to occupy two rebel-held areas of eastern Ukraine.
Sanctions include moves against Russian banks, cutting the country off from Western financing by targeting Moscow's sovereign debt, and penalising oligarchs and their families who are part of Putin's inner circle.
US and allies including Britain have warned of further sanctions should Putin extended his country's military grip beyond the two territories in the eastern Donbas region.
So far the sanctions were not as bad as markets had feared -- crucially with none aimed at Russia's crude exports -- providing some much-needed breathing room for investors and halting the surge in oil prices that has seen both main contracts pile on more than 20 percent so far this year.
"There's still considerable risk that oil prices may surge above $100 a barrel" if the situation escalates, said Vivek Dhar at Commonwealth Bank of Australia.
"Oil markets are particularly vulnerable at the moment given that global oil stockpiles are at seven‑year lows."
Dhar added that spare oil capacity among the Organization of the Petroleum Exporting Countries and its allies, including Russia, was "being questioned due to disappointing OPEC+ supply growth".
The crisis comes with investors preparing for a series of interest rate hikes by the US Federal Reserve as it tries to rein in 40-year-high inflation.
Commentators said that while a March hike is baked in, forecasts for further increases this year are being affected by events in Europe as officials try to assess the impact on the economy.
"Markets will likely bubble along sideways now until we see Mr Putin's next move," forecast Jeffrey Halley, analyst at OANDA trading group.
Key figures around 1200 GMT
London - FTSE 100: UP 0.3 percent at 7,519.10 points
Frankfurt - DAX: UP 0.6 percent at 14,784.88
Paris - CAC 40: UP 1.0 percent at 6,852.37
EURO STOXX 50: UP 0.9 percent at 4,020.66
Hong Kong - Hang Seng Index: UP 0.6 percent at 23,660.28 (close)
Shanghai - Composite: UP 0.9 percent at 3,489.15 (close)
New York - Dow: DOWN 1.4 percent at 33,596.61 (close)
