Russian actions and bonds continue to depreciate against the background of the US commercial war. Global stock markets collapse quickly, and the Russian is no exception, although Russia has not been on the list of countries that Donald Trump has imposed customs duties, The Moscow Times noted.
By 1:30 pm, Moscow time, MOOF, the reference index of the Moscow capital market, had dropped by 3.9%, reaching 2675 points, an unheard of December 2024, according to the Russian independent publication, which writes from exile.
The Russian financial market was hit by a “perfect storm,” said Kirill Komarov, the head of the T-Investments analysis department.
According to the expert, a negative geopolitical agenda, a hard position of the central bank on the key interest, a strong rubble and the decrease of the oil price.
Investors have lost their confidence in the imminent decrease in interest, in the return of foreign investors to the capital market and in the stability of the profits of Russian companies. A powerful ruby combined with oil cheap is lower for the oil and gas sector, Komarov explained.
Declining actions
The shares of several companies registered decreases on Monday, until 13.30, Moscow time, among them: Norilsk Nickel, Novats, Gazprom, Gazprom Neft, Surgutneftegas, VTB and Lukoil.
The RGBI index, which reflects the prices of government obligations, has dropped by 1.7%, The Moscow Times notes.
The market is affected by geopolitics, the decreases on the international scholarships and the cheap oil, the analysts from the SBERCIB investment bank also show.
The prices of Russian Ural oil have dropped to the lowest level in 2023, while international Brent reference prices collapsed against the backdrop of commercial voltages between the US and China as a result of customs duties announced last week by Donald Trump, Reuters calculations based on traders.
The low price for the Ural Petroleum barrel will put pressure on the Russia's budget. And this comes at a time when there is a deadlock in negotiations for an armistice in Ukraine between Moscow and Washington.
The price for the Brents oil barrel continues to decrease, reaching $ 63.15, the lowest level in 2021.
The price of Russian oil, at the lowest level of March 2023
Last Friday, Russian Ural Oil had reached $ 53 for a barrel, according to data analyzed by Reuters. This means that Monday, its price will reach about $ 50 per barrel if the price for brent crude oil will decrease until the markets are closed.
If this trend continues, the price of Russian Ural oil will reach the lowest level of March 2023, according to data calculated by Reuters.
All this led to the longest consecutive decrease in the MOOF index, although not the deepest, said Komarov.
The index is declining for the 14 consecutive session. In addition, many investors have bought shares with which to have an advantage while waiting for a geopolitical relaxation. Since mid -March, the main indicator of the Russian stock market market has already lost 17%.
The Kremlin monitors the situation
Such a situation cannot take long, believes Komarov: if the rubla remains strong, a key interest reduction could follow, or, on the contrary, a ruble depreciation if the oil price continues. Any of these scenarios could provide market support, he hopes.
Now we see panic and emotional reactions, Alexei Klimiuk noted from the company of alpha capital.
The Kremlin on Monday acknowledged the importance of oil prices for the budget of Ruisia, the spokesman, Dmitri Peskov, describing the turbulence of the global market triggered by Trump's customs duties as “extreme, agitated, tense and emotional overload.”
“Our economic authorities monitor this situation very carefully and, of course, they will do everything necessary to minimize the effects of this international economic storm for our economy,” said Peskov.
Sales of oil and natural gas represents one third of Russia's federal budget revenues.
