This morning the Ukrainian government announced that president Petro Poroshenko had reached agreement with Russia’s Vladimir Putin on a permanent ceasefire in the troubled Donbass region of eastern Ukraine.
If a ceasefire is genuine and holds, it is likely to bring a welcome easing of concern over whether the territorial dispute between Ukraine and Russia-backed separatists will escalate into open conflict between the two nations. Such an eventuality would have vast implications for global energy markets and asset prices.
The FTSE 100 rose by north of 50 points to around the 6900 level, bringing the significant milestone of 7000 in sight, before slipping back slightly.
France’s CAX also climbed around 50 points to 4440 while Germany’s DAX jumped over 100 points to over 9600.
A rally in US share indices could well follow when markets open across the Atlantic this afternoon, depending on how events play out in the coming few hours.
Should news emerge to indicate the ceasefire is not genuine or likely to last long then the gains could be quickly reversed.