The ruble fell to a fraction of one cent after worldwide actions were taken to stop Russian President Vladimir Putin’s war against Ukraine. And for two days, the Moscow Stock Exchange stayed closed to prevent a run on banks. But the graphic visual of its ups and downs has just fallen straight off a cliff.
BlackRock told investors with an interest in Russian shares and funds, to wait to take advantage while the “volatility lingers,” according to The Forbes Magazine.
The two biggest U.S. exchange-traded funds with Russian-based stocks, the VanEck Russia ETF and iShares MSCI Russia ET, lost their parachute and fell like a rock, dropping 30 percent each. Then on Tuesday, they dropped another 10 percent as soon as the stock market opened.
We saw that represented almost two billion dollars in funds. They have fallen around 62 percent in the last two weeks, ever since countries began implementing sanctions.
The leading Russian institutions:
‘[Included the] financial institution Sberbank, while businesses dropped billion-dollar investments in other firms like gas giant Gazprom.’
BlackRock said on Tuesday:
‘[It would not issue] new shares of its Stock MSCI Russia ETF until further notice…[after the] significant [Ruble] declines.’
The blowout of the ruble and Moscow’s failing stock liquidity could be attributed to American, EU, and other countries’ sanctions on Russian businesses and a closed stock exchange.
Interest rates flew up to 20 percent from 9.5 percent, CNBC reported:
‘At the same time, the Russian central bank has hiked its key interest rate to 20 percent from 9.5 percent, in an effort to boost the sinking ruble. It also said it will free 733 billion rubles, or $8.78 billion, in local bank reserves to boost liquidity.’
Investors were advised to wait until the Ukraine war has gone quiet and the Russian Central Bank opened the Moscow Stock Exchange again.
Moscow Stock Exchange has about 200 stocks shown. The exchange stayed closed for a second day this week. The Russian Central Bank announced it would remain closed through Saturday. Although:
‘[It would consider the option of reopening as it] assesses the feasibility depending on the development of the situation.’
Ever since Putin sent his military to invade Ukraine last Thursday, his economic problems have just worsened. The European Union, the United Kingdom (UK), and America’s sanctions went after Russian oligarchs, businesses, and even Russia’s government:
‘The nation’s ruble sank to an all-time low of nearly 118 against the U.S. dollar in offshore trading on Monday but has since pared back losses to about 104 rubles per dollar.’
Two giant companies British Petroleum and Shell plus the largest sovereign wealth fund left Russia, according to Reuters. They point to the bigger nation attacking its much smaller neighbor Ukraine for no reason, a dramatically less-than logical move:
‘That follows a move over the weekend by the European Union, U.K., U.S. and Canada, all of which pledged to remove selected Russian banks from SWIFT, or the Society for Worldwide Interbank Financial Telecommunication.’
Removing Russian financial institutions from SWIFT would “sever them from most of the global financial system:”
‘The payments system connects more than 11,000 banks and financial institutions worldwide, meaning the removal of Russian banks from SWIFT would sever them from most of the global financial system.’
Economic experts said the war has made Russia “increasingly uninvestable for global investors,” CNBC reported.
Updates to follow.
Featured image is a screenshot via YouTube.
Three White Lions is Gloria Christie’s new serialized book available in episodes on Amazon. Go to Kindle Vella and insert her name. She also writes for the liberal online newspaper The Bipartisan Report. Gloria Christie Report her newsletter for people on the go. Written in her own unique style with a twist of humor in a briefer version of Bipartisan Report. Christie’s Mueller Report Adventures In Bite-Sizes a real-life compelling spy mystery. Find her here on Facebook.