Since Putin’s attack on Ukraine, stock trading in Russia has largely come to a standstill. Now things started again on the Moscow Stock Exchange. However, only in a slimmed-down version.
The Moscow Stock Exchange resumed trading on Thursday after almost a month’s pause due to Russia’s war of aggression against Ukraine and Western sanctions against Russia. However, only shares of 33 companies were allowed to be traded.
These included gas monopoly Gazprom Gazprom Shares (ADRs), oil company Lukoil LUKOIL Shares, the country’s largest bank under US sanctions, Sberbank, and state-owned airline Aeroflot. The Moex Russia index recently rose by around ten percent. The index recouped a small portion of the losses it had posted prior to the suspension.
However, investors cannot bet on falling prices as short selling is prohibited. In addition, Russia’s central bank had already banned securities dealers from selling Russian securities owned by foreigners in February. The steps are intended to contain the consequences of Western sanctions against the country on the stock market and avoid further, major turbulence.
USA: Russia is playing us something
The US government has described the resumption of trade as a “charade”. “This is not a real market and not a sustainable model, which only underscores Russia’s isolation from the global financial system,” Deputy National Security Advisor Daleep Singh said Thursday.
Russia has made it clear that it will use state funds to artificially support the shares of trading companies. Only 15 percent of the listed shares are admitted to trading. The United States and its allies would continue to take steps to isolate Russia from the international economic order.
Russian stocks removed from major ETFs
Trading was halted after the Moex Russia plunged by nearly half shortly after Russia’s February 24 attack on Ukraine. Investors had tried to withdraw as much money as possible and bring it to safety. Shares in Russian companies have since been removed from major global exchange-traded index funds.
According to a market expert, the Russian stock market crash could well attract some domestic buyers. Perhaps they were doing so to brace themselves for the country’s skyrocketing inflation, which is melting the value of cash.
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