The Russian stock market has fallen to the level of 2020 due to geopolitical risks

The Russian stock market collapsed on Monday’s main trading on major stock indices by amounts comparable to the collapse at the start of the pandemic in March 2020.

Thus, the ruble index of the Moscow Exchange fell by 5.93% to 3235.28 points at the close of the main trades, and the RTS dollar index fell by 8.11% to 1288.17 points.

The difference in the dynamics of the indices is explained by the growth of the dollar by 1.7 rubles, to 79.13 rubles.

During trading, the Moscow Exchange index fell to 3158.46 points. This is the minimum since December 8, 2020.

Among the companies whose shares fell the most were Rusal, PIK, RusHydro. The collapse occurred, among other things, against the backdrop of statements about possible sanctions against Russia by Western countries.

As Artur Bedzhanov, the personal broker of BCS World of Investments, told Gazeta.Ru, the rise and fall of shares is a normal and inevitable phenomenon. To better understand when such situations can be expected, one should understand the basic economic principles: their impact on life, and, in particular, on stock markets.

But the analyst of FG “FINAM” Yulia Afanasyeva believes that there are still reasons for concern, if we talk about medium-term or long-term investments.

“Many console themselves with the thought of the old adage that stocks always rise and that drawdown will be bought out. In fact, there is a translation error in this saying: it is not stocks that always grow, but markets. Individual stocks can fall for years and decades and even die,” Afanasyeva explained.

According to Andrey Zaostrovtsev, an economist and professor at the Higher School of Economics, many factors are in favor of strengthening the ruble, but the crisis in relations between the Russian Federation and Ukraine does not allow the currency to get out of problems. In a comment to a Rosbalt correspondent, the expert pointed out that the issue of the fall of the ruble should be addressed to the President of Russia.

“Although I’m not sure that he understands what he plans to do tomorrow. Maybe fluctuating? In any case, the jump is caused by purely political events,” the expert noted, referring to reports of a possible invasion of Russian troops into the territory of Ukraine.

According to Zaostrovtsev, under different conditions, the ruble could get stronger today.

“All economic factors are in favor of this: the price of oil, the price of gas, and the excellent balance of payments. Everything you need! Many stockbrokers say that if it weren’t for politics, the dollar would cost 70 rubles, no more. But politics is politics. Panic moods begin to cover the broad masses of brokers. Here is the result,” said the expert.