Russian stocks, Ruble take hit on uncertainty over U.S. sanctions

  10 August 2018    Read: 2592
Russian stocks, Ruble take hit on uncertainty over U.S. sanctions President Trump and Russian President Vladimir Putin hold a press conference after their meeting in Helsinki on July 16. PHOTO: GRIGORY DUKOR/REUTERS

Newly announced U.S. sanctions—and the potential for a second round of actions in 90 days—roiled Russia’s currency and blue-chip stocks as the country braced for further economic pain amid uncertainties over the Trump administration’s commitment to enforcement.

In Moscow, the ruble shed as much as 5% against the dollar on Thursday and stocks plunged as much as 9%, led by state banks and national carrier PJSC Aeroflot-Russian Airlines , which risk losing access to U.S. markets if the sanctions escalate. In Washington, the administration remained notably silent on the action and offered few details on the severity of the prospective punishments.

The sanctions stem from a March nerve-agent attack against a former Russian spy in the U.K. The U.S. and Britain have held Russia responsible for the attack. Moscow has repeatedly denied involvement.

The sanctions are mandated by a U.S. law that requires action over the use of chemical and biological weapons—but President Trump maintains significant discretionary power over the degree of that punishment.

A spokesman for President Vladimir Putin of Russia struck a cautious tone and said Moscow remained committed to building “constructive relations with the U.S.” and wouldn’t draft countermeasures before learning the full details.

Others in the country expressed alarm and dismay over the U.S. move, which threatened to diminish hopes of improved bilateral ties.

 

The Wall Street Journal


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