November 22, 2024

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Russian stock market reopens after month-long closure

Russian stock market reopens after month-long closure
MOEX Standard Index Earned up to 10% in early trade in Moscow. The Russian Central Bank has banned short selling, and foreign investors are not allowed to part with stocks, a ban that could help prop up stocks.

Investors can trade 33 shares during the limited session from 9:50 am to 2:00 pm in Moscow. Among the shares that are traded are the blue chip companies Gazprom, Lukoil, VTB Bank, Sberbank, Rusal and Rosneft.

Russian stocks last traded on February 25 after President Vladimir Putin’s invasion of Ukraine caused stocks to plunge. The MOEX index has lost nearly 35% of its value this year, while the dollar-denominated RTS index is down 42%.

In the weeks after Russian stocks stopped trading, Western sanctions crushed the ruble and devalued its exchange rate country economy in a state of deterioration. President Joe Biden is expected to announce additional sanctions during his trip to Europe this week.

Foreign investors are not allowed to sell shares on Thursday under new rules that prohibit brokers from carrying out sales on their behalf.

Foreign funds acquired more than 80% of all shares traded on the Moscow Stock Exchange in the first half of 2021, according to Reuters. The United States and Canada accounted for 54% of the total, with 22% from the United Kingdom and 21% from the rest of Europe.

The Biden administration called the reopening “characteristic.”

“Russia has made it clear that it will inject government resources to support stocks of companies that are artificially traded,” Deputy National Security Adviser Dalip Singh said in a statement. “This is not a real market and not a sustainable model – which only confirms Russia’s isolation from the global financial system.”

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—— Kevin Liptak contributed to the report.