Russian stocks to outride global market slumping?
Asian markets slumped, wiping out billions of dollars, with heavy falls in Tokyo, Hong Kong, Shanghai, and Bombay.
Europe followed suit with stocks plunging in London and Frankfurt, with further subprime-related losses in the banking sector.
Russian stocks didn't stand a chance – with the RTS and Micex in Moscow both shedding more than 7 per cent.
“Very sharp drops in developed markets will make fund managers reduce their risks in emerging markets. And Russia is the number one stock to sell because it’s very liquid,” said Igor Prokhaev from Troika Dialog.
But analysts in Russia tend to agree that in the medium to long term, Russia is well-equipped to ride out the storm.
“No Russian companies have invested in American mortgage businesses, so I don’t think we are expecting any big losses. And the high level of consumer spending in Russia will also support the performance of Russian companies,” said Aleksandr Potavin, Atlanta Capital analyst.
For now though, all eyes will be on the U.S. equity markets when they re-open on Tuesday.
And all ears will be awaiting the latest announcement from the U.S. Federal Reserve at the end of the month.