European stock markets rose on Wednesday as investors paused after three days of selling as oil prices retreated from their recent peak.
Russia accused the US of declaring an economic war after US President Joe Biden announced a ban on Russian oil exports on Tuesday.
Western sanctions have cut off Russia from global trade and financial markets in response to its invasion of Ukraine.
But after three days of losses, the MSCI world stock index, which tracks stocks in 50 countries, was up 0.7% by 1224 GMT on the day.
The European STOXX 600 gained 3.1% and Wall Street futures also rose.
Peter McCallum, interest rate strategist at Mizuho, said the rebound in stocks was a temporary recovery rally that could be attributed to news of Russia-Ukraine talks.
“People think we may have seen the worst of the escalation for the foreseeable future,” he said, describing the day’s upleg as “consolidation.”
“Perhaps markets are less panicked about the escalation of conflict to other regions than they were at the beginning of the week.”
Analysts viewed the recovery as a technical correction and not a signal of a noticeable change in sentiment regarding the conflict, which is Europe’s biggest war since World War II.
“Right now, markets are relieved that we haven’t had any fresh bearish news since yesterday’s announcement of a ban on oil imports from Russia,” said Fawad Razaqzada, market analyst at Think Markets.
“Markets have been severely oversold…that’s also typical of a bear market when you sometimes see multiple percentage point gains in a short space of time as the shorts get pushed down before the rally loses momentum and the downtrend resumes. “
The Russian invasion and subsequent sanctions have devastated global supply chains and pushed up commodity market prices.
Oil prices edged higher after the US ban, which analysts at Goldman Sachs said had already been priced in, but by 1238 GMT on Wednesday they had retreated somewhat.
Brent crude futures were at $124.78 a barrel, down 2.5% on the day after falling from Monday’s high of $139.13.
Analysts at JPMorgan said the war has triggered the highest commodity price inflation in more than 60 years in the past two weeks.
“Russia has a dominant supply position in: nickel, palladium, platinum, rhodium, aluminum and copper,” JPMorgan said.
Dan Scott, chief investment officer at Vontobel, said that “turbocharged” commodity price inflation is putting central banks in a “difficult situation”.
“War is inflationary, and this war in particular is very inflationary…not just in terms of energy, oil and gas, but in the entire commodity complex.”
“Grain prices are not responding to central bank policy, and neither are nickel prices necessarily… Rate hikes will not have a direct impact.”
The London Metal Exchange intervened on Tuesday to calm the nickel market after prices soared to record highs of over $100,000 a ton in a matter of hours.
After a four-day rally, gold fell on Wednesday as markets turned less risk-averse.
The safe-haven dollar fell 0.5% against a basket of currencies to 98.572.
German government bond yields rose ahead of Thursday’s European Central Bank meeting.
The US 10-year Treasury yield was slightly higher at 1.9061%.
Elsewhere, Bitcoin led a rally in cryptocurrencies after what appeared to be a premature release of a statement on the US Treasury Department’s website calmed fears of a sudden tightening of US rules on such assets.