Premarket stocks: Russia is breaking market rules left and right

3.24.22
Russia is breaking market rules left and right as its financial isolation deepens. Russia's stock market reopened on Thursday after it was shuttered for a month. Under normal circumstances, there wouldn't be much demand for shares in Russian companies considering they do most of their business in an economy that some expect to contract by more than 20% this year. But, surprise! The benchmark MOEX index surged by as much as 10% in early trading. The index was up roughly 5% in afternoon trade in Moscow. Here's why: Russia's stock market isn't operating under normal rules. The central bank has blocked foreign investors from selling their shares and banned short selling. Only 33 stocks were allowed to trade on Thursday.

Context: Foreign funds held more than 80% of shares trading on the Moscow 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 wasn't very impressed with the "reopening." "Russia has made clear they are going to pour government resources into artificially propping up the shares of companies that are trading," deputy national security adviser Daleep Singh said in a rare White House statement on another country's financial markets.

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HIP56948 said:

Only 33 stocks were allowed to trade.? The stocks traded on the NASDAQ and NYSE is something like 5,300. True... I think? only 30 are the big factors.Somebody correct me if needed.

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Rogue Valley said:

This was stage-managed by Russia's Central Bank.

No one involved could lose money.

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phoenix2020 said:

This is why sanctions, like tariffs, usually don’t have the effect everyone hopes for.

If countries really wanted to “go there” they could offer to compensate funds with confiscated Russian foreign reserves, in exchange for funds writing off Russian investments as junk holdings and dropping them from their books.

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OrphanSlug said:

Looks like an entirely staged event, behind the scenes I would bet all kinds of ownership swap / seize shenanigans.

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