White House calls reopening of Russian stock markets ‘a charade’ as prices rally

The surprisingly strong performance of the MOEX came despite sanctions imposed on the Russian economy

The Moscow Stock Exchange resumed trading of some shares on March 24, the second stage in a phased re-opening (Getty Images)

The White House has called Russia’s move to re-open the stock market after two months a “charade” as the Mocow exchange sees a surprisingly ubpeat trading session despite crippling sanctions and boycotts.

On Thursday, the Moscow Stock Exchange (MOEX) opened for a restricted session after its longest shutdown since the fall of the Soviet Union. The trading window was set between 10am and 2pm Moscow time following a surprise announcement from the Central Bank of Russia on Wednesday.

The trading took place amid massive curbs, including ban on short-sellers and non-Russian investors until 1 April. Furthermore, only 33 out of Ruble-denominated Russian equities were allowed to be traded.

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However, the index began gaining from the opening, and closing more than five per cent up by around 2pm.

The surprisingly strong performance came despite major hits suffered by the Russian economy with western sanctions and boycott by major corporates including most of its banks thrown out of the Swift messaging system and president Vladimir Putin’s new demand that buyers of Russian energy pay in rubles.

The White House called this trading session an attempt by Russia to artificially prop up stock prices.

“Russia has made clear they are going to pour government resources into artificially propping up the shares of companies that are trading,” said Deputy National Security Advisor for International Economics Daleep Singh in a statement.

“This is not a real market and not a sustainable model — which only underscores Russia’s isolation from the global financial system,” the statement further said.

Russian people walk on Red Square in front of St. Basil’s Cathedral, Moscow (EPA)

The country’s stock exchange had been closed since 25 February after Russian assets plunged across the board following the country’s attempeted invasion of Ukraine and in anticipation of the punishing international sanctions that followed.

The two stock exchanges of Russia — the MOEX and dollar dominated RTS — have lost around one-third of their value this year while the ruble has plunged drastically pushing the country’s economy in jeapordy.