The Daily Telegraph
Putin’s nuclear war threat sends Russian stock market tumbling
THE Russian stock market tumbled after Vladimir Putin ordered his country’s first mobilisation since the Second World War and said he was prepared to use nuclear weapons, yesterday.
Mr Putin’s bellicose warning sent the Moscow Stock Exchange’s MOEX index plunging by as much as 10pc, marking the second day in a row of big losses.
The MOEX had already fallen by 9pc on Tuesday after the president’s threat to annex parts of Ukrainian territory held by his troops, using what have been branded “sham” referendums.
The escalation sent shockwaves through gas markets as well, with the European benchmark price jumping 8pc to about €210 (£183) per megawatt hour. Sterling and the euro weakened as investors took flight to the dollar.
Russia’s stock market has already taken a beating in the past year, with the MOEX halving from 4,000 points a year ago to just over 2,000 today.
Susannah Streeter, a senior investment and markets analyst at Hargreaves Lansdown, said: “Fears have ratcheted up that there will be a sharp escalation of the war in Ukraine, sending investors scuttling into safe haven assets.”
Mr Putin declared “partial mobilisation”, calling up 300,000 reservists in a major escalation of his flagging invasion of Ukraine. In a televised address, he also warned: “Those who are trying to blackmail us with nuclear weapons should know that the wind patterns can also turn in their direction.”
His threats came after a Ukrainian counter-offensive dealt Moscow’s troops their worst defeats since the early months of the conflict, retaking more than 10pc of the territory that Russia held. EU sanctions on Russian coal and other commodities have been relaxed amid concerns over world energy security.
Member states can now transfer certain goods, including coal and related products “to combat food and energy insecurity around the world”.
Brussels said a full ban on Russian coal remained in place for shipments into the EU and the changes only concern goods destined for third countries.