FX168 Financial News Agency (North America) reported on Tuesday (November 19), global stock markets generally fell as investors flocked to safe-haven assets in response to the escalating tensions between the nuclear powers of Russia and the USA.

The Stoxx 600 index recovered from earlier lows, but still closed down 0.45%, marking the lowest level since August.

Meanwhile, in the US market, several stocks reversed their earlier declines. Among them, the technology stocks represented by Nvidia performed outstandingly, with the Nasdaq composite index up 0.48% as of the time of publication. The S&P 500 index rose 0.13%, while the Dow Jones industrial average remained in a downward range, decreasing by 0.32%.

Previously, Russian President Putin modified the country's nuclear principles, clarifying the conditions under which Moscow would deploy nuclear weapons.

Although Moscow indicated months ago the intention to update these principles, the amendments were implemented days after the USA decided to allow Kyiv to use American-made long-range missiles on Russian territory.

According to NBC News, the Russian Ministry of Defense stated on Tuesday that Kyiv had launched six American-made long-range ballistic missiles toward the Bryansk region in western Russia during the night.

The updated nuclear principles detail the conditions that prompt Moscow to deploy its nuclear arsenal, importantly expanding the scenarios under which it considers nuclear retaliation.

Kremlin spokesman Dmitry Peskov stated that the new code stipulates that the Russian Federation reserves the right to use nuclear weapons when faced with aggression using conventional weapons in Russia or the Republic of Belarus, or when there are serious threats to sovereignty or territorial integrity.

According to NBC News, any non-nuclear country participating in or supporting aggression against the Russian Federation is considered a joint attack.

The potential for nuclear escalation is driving investors into safe-haven markets. As of the time of writing, gold prices have risen by 0.55%. Meanwhile, as investors steer clear of risk assets, bond prices have increased and yields have decreased.

In the forex market, the yen has risen by 0.4% against the euro and by 0.3% against the dollar, despite pulling back from earlier highs. The swiss franc has also increased by 0.2% against the euro.

Wells Fargo & Co macro strategist Eric Nelson commented on the exchange rates of the dollar and the yen, stating: 'The sharp drop in bond yields and in the dollar-yen exchange rate is indeed noteworthy, but what is more telling is how quickly this decline… will fade.'

'As we enter the last few weeks of this year, there is clearly still a preference to hold stocks with high inflation and robust growth. Market participants may recall the headline risks from the early days of the Russia-Ukraine war and might be inclined to downplay the declines in yields and the dollar-yen exchange rate, as long as any signs of escalation remain merely rhetorical.'

The USA has decided to allow Ukraine to launch US-made missiles into Russian territory, marking a significant shift in Washington's policy regarding the war in Ukraine.

It remains to be seen whether other NATO allies providing critical military and humanitarian assistance to Ukraine will align with the White House and authorize Kyiv to use their weapons in actions against Russian territory.

Currently, most NATO allies tend to avoid taking this step, fearing possible retaliation from Moscow. Putin has previously hinted that if NATO formally intervenes in the war, it could provoke nuclear provocations. In June, Putin stated that Russia is strengthening its nuclear arsenal — since the Kremlin inherited the vast majority of weapons of mass destruction after the collapse of the Soviet Union, Russia's nuclear arsenal is the largest in the world.

Tuesday marks the 1000th day since the outbreak of the Russia-Ukraine conflict. The General Staff of the Armed Forces of Ukraine updated on Facebook via Google Translate, stating that a "fire was caused" in Bryansk, but did not specify whether Kyiv utilized U.S. weaponry for this.

Tiffany Magee, CEO and CIO of Pivotal Advisors, stated in an interview, "The conflict is escalating... I expect to see some immediate, instinctive market reactions."

She emphasized the need to consider market impacts from a long-term perspective and noted that since Russia's full-scale invasion of Ukraine in February 2022, there have also been similar short-term reactions.

"In the long run, this is the third year of the conflict. Although initially we saw prices soar... they have now stabilized," she said.

Western countries have imposed sanctions on Russian oil supplies, making the oil market the most directly affected by the war. Despite the increased likelihood of conflict between the two major global crude oil producing countries, the performance of the oil market on Tuesday remained varied.

ICE Brent crude oil futures for January fell 0.3%, while the price of the near-month December contract decreased by 0.36% compared to Monday's settlement price.