Trump Putin’s talk is already a victory for Moscow, its economy and markets

While talks between Russian President Vladimir Putin and US counterpart Donald Trump are still days away, the meeting of two leaders to negotiate an end to the war in Ukraine is already considered a victory for the Kremlin, the Russian economy and global financial markets.

The discussion is scheduled to take place in Alaska on Friday.

“This is already a great victory for Putin to be invited to meet with the US president on American soil for the first time. From his perspective, it is a great achievement of the absence of Ukraine and the lack of representation of Europe. This is already a victory.

The mood is Kiev’s mood, with Ukraine potentially forced to hand over Russian-occupied territory to Moscow, and officials, including President Voldymir Zelensky, have not been invited to talks so far.

Kiev has said he will not do anything about his future being hit in the absence of its future, and European leaders are pushing Ukraine’s involvement strongly. The US is considering inviting Zelenskyy, NBC News said it reported.

In the meantime, economists say that the talk given while Russia is profiting on the battlefields of southern and eastern Ukraine does not see a ceasefire deal, but it is already a victory for his war-centric economy, who is working under international sanctions in June and stubbornly high inflation.

“(Putin) starts from a relatively strong position on the battlefield. They are on the way… On the other hand, from an economic standpoint, he starts from a weak position. The Russian economy is not a very good fiscal deficit.

Russia is likely to be in talks with a strong position on the battlefield and want immediate sanctions relief as part of its ceasefire agreement and part of Ukraine’s territorial concessions.

The Kremlin spies on a settlement with Washington as an investment opportunity as well as an economic recovery. “Our country’s economic interests are expected to intersect in Alaska and the Arctic, with large, mutually beneficial projects expected to be implemented,” Russian presidential aide Yuri Ushakov said on Saturday.

Port said Trump “waiting (to hold consultations) would make a huge difference in the balance of power if he was willing to properly apply patience and sanctions.”

But as things stood, Trump pondered, but so far had refrained from increasing sanctions against Russia. Instead, Washington is threatening remaining Kremlin trading partners, such as India, with “secondary sanctions” and additional trade tariffs to continue purchasing Russian oil, which has funded Moscow’s war machinery.

Asked if Trump could push Putin to a peace deal, Port asked, “Can anyone predict what the US president will do from day to day? That’s very difficult.”

“The possibility of an increase in sanctions pressure is important, but… given Trump’s desire for the Nobel Prize, it doesn’t seem very likely that Trump will increase sanctions at this stage, but tomorrow can change his mind,” he said.

Global financial markets will respond positively to Friday’s announcement, and discussions to end the war will be imminent as European and US lawsuits are rising. But while European defence stocks fell into the news, traders appeared to have bet that peace could block further investments pledged by NATO allies.

The spot price of gold, considered a safe haven in times of geopolitical and financial market stress, is 8a.m. Monday in London time.

German Rhinemetal stocks were trading almost 4% lower, while Hensold fell 1.5% and RENK fell 3.3% in initial trading. Leonardo in Italy and Thales in France also fell by 1.9% and 1.7%, respectively. Meanwhile, BAE Systems and Babcock, listed in London, have given up on profits from the day when the 1.1% and 1.3% declined, respectively, at around 9am in London.

However, Christopher Granville, managing director of TS Lombard, said the speech could ultimately prove to be a “winner in European defence stocks,” advised investors to “buy that weakness.”

Granville said that if the peace process fails, it would need to be restocked with the US and Europe’s depleted weapons catalogue.

“Or if there is a peace agreement, what do we see? We see a very strong Russian army – the words “Victory” and “Defeat” take on, but perhaps not to be used, but that reality forces ongoing defence procurement by the European government.

“Of course, the market has discounted this from time to time. If the names of those (defensive stocks) are pulled back a bit, in my opinion, we should buy that weakness.”