FX.co ★ Russian Stocks Record Losses

The MOEX Russia Index dropped below the 2,800 mark towards the end of September, reflecting widespread pressure on Russian assets due to a negative economic outlook for the country. The United States has urged G7 nations to strengthen sanctions against Russia in response to its invasion of Ukraine and recent airspace violations over NATO territories. This has prompted Brussels to suggest harsher penalties targeting Russian oil and financial institutions, along with the potential for a complete ban on Russian LNG. These developments have intensified the adverse effects of low natural gas prices on major Russian producers, with Gazprom's stock hovering near a record low of RUB 120 per share. Concurrently, sanctions pose a threat to target tankers and nations still purchasing Russian oil and fuel, leading to significant losses for companies like Lukoil and Rosneft since the beginning of the year. The broad pressure on the Russian corporate sector is further exacerbated by projections that the Central Bank of Russia may have concluded its interest rate cutting cycle, as increased taxes in Russia's new budget could trigger a resurgence in inflation.