Turmoil in Emerging Markets hit investor confidence in January and, after a stellar February, the crisis in the Ukraine could lead to profit taking this month. Indeed, volatility spiked to a similar level and the S&P came off its all-time-high on Friday as fears started to set in.

Ukraine mobilised for war over the weekend after calling Russia’s ‘right to invade’ a “declaration of war”. The split within the country, between those wanting closer ties with the EU and those looking to Russia, is not so clear cut. It is not a 50/50 split and Russia’s influence within the country is not as prevalent as is widely believed. The Crimea, is indeed a hot spot – the location of Russia’s Black Sea military base and a large local employer but what is overlooked is that many Russian-speaking Ukrainians are nevertheless nationalistic.

Approaching bankruptcy, with an economy larger than Greece’s, the path to solvency is not clear.

Requesting aid from the US or Europe, they have already refused structural reforms required for a bailout. Furthermore, their financial burden looks to worsen as they risk losing the ability to buy gas from Russia at a discounted price.

Reliant on Russia for a substantial percentage of their gas needs, this turmoil effects Europe directly as well.

For US policy, the question is whether a rise in political risk could constitute the “significant change” the Fed said they need to see in order to halt winding down support. Currently rhetoric implies a commitment to staying the course, but if it seems economic weakness is due to more than the bad weather, this could prove convenient.

What to watch: Energy commodities are feeling the impact. Companies with tight margins and high input costs may be hit as gas and oil prices rise. Defence stocks may see renewed interest despite a military intervention being unlikely.

Gemma Godfrey is Head of Investment Strategy at Brooks Macdonald, a CNBC broadcaster, Board Director and Quantum Physicist by background. Voted the most popular businesswoman on Twitter by AdvisorOne and one of the savviest by the Wall Street Journal, follow Gemma @GCGodfrey and read her views at www.TheInvestmentInsight.com.