One of the suggested catalysts for yesterday's late day rebound, was yet another iteration of diplomatic de-escalation in Ukraine, when not only did Russian defense minister Sergei Shoigu advise Chuck Hagel that Russia has no plan of bringing its troops to Ukraine - something Russia has said since the conflict started, even as it has repeatedly affirmed it would waste no time to protect ethnic Russians in east Ukraine - but when Interfax reported that Russian troops are returning from military drills by the Ukraine border to their respective bases. This alone was enough to send the S&P roundtripping from nearly red for the year, to up half a percent for the day. There are a few problems with this latest de-escalation gambit however.
First of all, as Reuters reported earlier, "NATO has seen no sign that tens of thousands of Russian troops are withdrawing from close to the Ukraine border, a NATO official said today, despite a Russian statement that the troops had returned to their permanent positions." But... the algos said that all is well again? Guess not.
Russian Defence Minister Sergei Shoigu told U.S. Defence Secretary Chuck Hagel in a phone call on Monday that Russian forces, which started drills near the border last week, had returned to their permanent positions, according to the Russian government.
"We currently have no information that indicates a withdrawal of Russian troops from the Ukrainian border. We continue to urge Russia to abide by the Geneva agreement and to pull back all its troops along the Ukrainian border in favour of diplomacy and dialogue," a NATO official told Reuters, asked about Shoigu's assertion.
Not only that, but as can be expected, following the latest round of sanctions against Russia by the West, a Russian retaliation was inevitable. Sure enough, Interfax reported that Russia is preparing retaliatory measures after latest round of U.S., EU sanctions, citing Valentina Matviyenko, speaker of Federation Council, upper house of parliament.
"Such unfriendly attacks, imposed unilaterally against Russia without reason, can’t be left without a response, and I believe there certainly will be a response,” Matviyenko is cited as saying.
Furthermore, as AFP reported separately, Moscow on Tuesday vowed to hit back at Japan over its decision to deny visas to 23 Russian nationals as part of additional sanctions linked to the crisis in Ukraine.
The Russian foreign ministry said that Tokyo's decision was "met with disappointment in Moscow, and of course will not be left without a response".
And finally, perhaps the best example of what is really going on, we read this:
- PROTESTERS STORMING REGIONAL BUILDING IN LUHANSK: INTERFAX
- PRO-RUSSIA SEPARATISTS CONTROL ADMIN. BUILDING IN LUHANSK: RIA
Bloomberg reports further that protesters in the east Ukrainian city took control of administrative building, are disarming police, Russian state news service RIA Novosti reports.
Protesters broke windows to enter building, Interfax reports; Russian state television shows smoke coming from upper windows of building, people waving flags including Russian flag from top of building
Interfax adds that some of protesters are carrying sticks, batons, and probably other pain-creating objects. Oh well, the "de-escalation" was fun while it lasted. Back to the same old daily grind again.