NZ stock market falls 2.78% as Russia goes to war with Ukraine

New Zealanders are among those looking on in concern as explosions rock several Ukrainian cities, stoking fears of a widespread Russian invasion.

As well as threatening the lives and safety of those in Ukraine, Russian military manoeuvres will cause economic shocks.

Global stocks have plunged on the back of Russia’s move.

New Zealand’s sharemarket suffered its biggest single-day fall in nearly two years yesterday, sliding nearly 3%, as Russia went to war against Ukraine.

By 5pm, the S&P/NZX 50 Index had slumped 337.11 points, or 2.78%, to 11,797.3 — the lowest level since September 25, 2020, when the index sat at 11,797.08.

For those in New Zealand with investments in KiwiSaver or the sharemarket, any sustained fall on stock markets will hit their portfolios or their account balances.

The invasion is also predicted to push up New Zealand petrol prices.

Infometrics principal economist Brad Olsen tweeted how oil prices were already up.

"Watch for 91 in NZ to increase to above $3/l, with discounted fuel up to $2.85/l or so."

Higher oil prices also mean that costs for many businesses will rise, and they could too be passed on to consumers.

There are 23 New Zealanders registered on SafeTravel as being in Ukraine at present, the Ministry of Foreign Affairs said earlier yesterday.

Seventeen New Zealanders have fled the country since Foreign Affairs Minister Nanaia Mahuta warned them to "leave immediately" on February 12.

Explosions had been reported in several Ukraine cities, including the capital Kiev, as Russia launched "full-scale war", the Ukrainian Government said.

Russian President Vladimir Putin declared a "special military operation" but the Ukraine Interior Ministry said the Russian invasion had started.

Ukraine Foreign Minister Dmytro Kuleba called it "full-scale war".

US President Joe Biden and other Western leaders have condemned Russia’s move, but Mr Putin warned them any attempt to interfere with the Russian action would lead to "consequences they have never seen".

He said the attack was needed to protect civilians in eastern Ukraine, a claim the US had said he would falsely make to justify an invasion.

In a televised address, Mr Putin accused the US and its allies of ignoring Russia’s demand to prevent Ukraine from joining Nato and offer Moscow security guarantees.

It comes after Ukraine declared a state of emergency over the unfolding crisis with Russia, and Mr Putin sparked panic by recognising the breakaway territories of Luhansk and Donetsk in eastern Ukraine — known collectively as the Donbas region — earlier this week.