Russian Stocks Plunge 44% in 2022

Russia’s MOEX Russia index closed Friday at 2,154, plunging 44% on the year. The ruble-based index reflected the fallout from the Russian invasion of Ukraine and consequent sanctions by Western countries. Russia’s action triggered investor’s exodus from oil and gas companies to McDonalds. The Moscow Exchange and the Central Bank of Russia both attempted to halt the selling, including closing the stock market for one month at the end of February, banning foreign investors from “unfriendly” countries, and prohibiting short … Continue reading “Russian Stocks Plunge 44% in 2022”

Russian Stocks & Rouble Freefall as Putin Recognizes Donbas Independence

Tensions between Russia and Ukraine continued to soar after Russia’s parliament appealed to Putin to formally recognize the Russian-backed separatist quasi-states Donetsk and Luhansk People’s Republics independence, in the Donbas region in Ukraine. Such a move Germany’s Scholz says would be a one-sided breach of Minsk format. This would torpedo the peace process and sent the MOEX Russia Index dumped as much as 14% with Rosneft (-18.3%), VTB (-17.3%) and Sberbank (-16.9%) hit. The Rouble shed over 2% on Monday. … Continue reading “Russian Stocks & Rouble Freefall as Putin Recognizes Donbas Independence”

Russian Cracks Appear as Sanctions Bite and Unemployment Rises

Oil prices have risen since the December lows on hopes the Russians cut production,despite Russia at new production highs and despite promises in the past. Sanctions are biting and even official unemployment rates are rising, Russia needs income to sate it’s huge poor population.

Russian ETF Sees Biggest Outflow in a Year as Oil Prices Fall

Oil plummeted Friday after Russia and Saudi Arabia were quoted as increasing production. High oil prices are crucial for Russia’s vulnerable economy and the flow on was seen in Russia tracking ETFs which had avoided the emerging-market selling until now. Russia will be more circumspect going forward.

Russia Budget Rule Means Massive Debt With Rising Oil Prices

The irony of oil prices at their highest level in over three years are sending Russia so much cash that they have their first budget surpuls since 2011 but the country is deeper in debt. Their program of foreign currency purchases by the Finance Ministry means borrowing more rubles.

Higher Oil Prices Lead Standard & Poor’s and Fitch To Raise Russia’s Rating

With crude oil prices having risen for over a year Standard & Poor’s Global Ratings agency has raised Russia’s long-term and short-term sovereign credit rating to BBB-/A-3. Rating peer Fitch reaffirmed Russia’s investment grade level with a positive outlook.