Asian stocks may fall, dollar rise as Ukraine crisis deepens

New York (Mar 2)  Asian stock markets may suffer losses of as much as 2 percent this Monday as investors shun equities, opting instead for the relative safety of the U.S. dollar and treasuries as a stand-off between Ukraine and Russia threatens to escalate into conflict, investment professionals told CNBC.

"We believe it will be a broad-based sell-off," Naeem Aslam, chief market analyst at Ava Trade, told CNBC on Sunday. "If there is a military action, there could be over 2 percent gap to the downside. Before the markets open, gold and U.S. bonds could rally higher on the back of this and the same goes for the greenback."

Ukraine mobilized on Sunday for war and called up its reserves, after Russian President Vladimir Putin threatened to invade in the biggest confrontation between Moscow and the West since the Cold War, Reuters reported on Sunday.

Russian forces who have already bloodlessly seized Crimea - an isolated Black Sea peninsula where most of the population are ethnic Russian and Moscow has a naval base - tried to disarm the small Ukrainian contingents there on Sunday. Some Ukrainian commanders refused to give up weapons and bases were surrounded.

"We're witnessing the most seismic geopolitical events since 9/11," said Ian Bremmer, president and founder of Eurasia Group, a global political risk and consulting firm, in a situation update published on Saturday.

Nomura's Senior Political Analyst Alastair Newton was more restrained but believed Putin is nevertheless determined to "haul Crimea back into Russia" and Moscow risks opening up another front by possibly inciting "trouble" in the east of Ukraine where most of ethnic Ukrainians speak Russian as a native language.

"This is going to get very messy," Newton said. "But Crimea isn't Poland and this isn't 1939."

Source:  CNBC