Moscow: Russian stocks and the rouble rebounded after Monday’s rout as investors speculated declines triggered by the toughest US sanctions yet on local companies may be overdone.
The Micex Index rose 0.5 per cent, clawing back ground after its sharpest collapse since Russia annexed Crimea in 2014. The rouble, which weakened the most since February 2015, appreciated 0.5 per cent to 60.385 per dollar as of 10:04am in Moscow.
“The rouble’s recent performance is no longer driven by macro fundamentals — it’s solely the result of major shifts in the political area,” said Luis Saenz, co-head of global equities at BCS Global Markets in London. “Even if the geopolitical situation starts to normalise, we believe it will take more than a couple of trading sessions before the currency returns to the levels that are more in line with the solid state of Russia’s external accounts.”
Investors in Russia are pausing to lick their wounds after the sanctions, which blacklisted billionaire Oleg Deripaska’s United Co. Rusal and En+ Group Plc, raised concern that the US could ban dealings with any local firm of its choosing. The sell-off took traders back to 2014, when Russia’s role in the Ukraine crisis triggered an initial wave of international penalties and tumbling oil prices plunged the economy into recession.
