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Tuesday, September 26, 2006

Russian Bear Devours Russian Stock Market

Investors in the Russian stock market are being battered by tens of millions of dollars in losses.

Last Friday, the RTS Index of the Russian Stock Market fell 2%. In yesterday's trading, the RTS lost nearly 3.5% of its value, plunging from above 1500 at the start of the day's trading to 1450 by its close, as the graph below illustrates:

At the end of August, the RTS Index crested just above 1650, meaning that it has shed 250 points in one month -- over 15% of its total value -- as shown below:

The Moscow Times reported that "investment funds focused on Russia and the CIS lost $11 million in the week ending Wednesday and $18.5 million in the week ending Sept. 13, according to figures from Emerging Portfolio Fund Research."

These losses are coming as the price of oil falls, something Americans are now seeing at the gas pump. As La Russophobe has said before, Russia now has a vested fundamental interest in keeping the price of oil high, meaning that it has a strong incentive to inflate the price of oil by causing turmoil in the Middle East. Thus, it's support for terrorist organizations like Hamas and Hezbollah, as well as for rogue regimes like Iran and Syria, is not suprising. New policies to deal with this worsening horror are needed.

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