First Russian company declared in default
State-owned Russian Railways has been ruled in default by a derivatives panel after missing a bond interest payment.
State-owned Russian Railways has been ruled in default by a derivatives panel after missing a bond interest payment.
With Russian troops laying siege to Ukraine’s two largest cities, I certainly don’t blame financial markets for a high degree of anxiety. After all investors and traders are also looking at the consequences of massive sanctions piled on Russian banks including the country’s central bank, disruptions of the global grain trade, and energy shortages here, there, and everywhere. The selling today is fundamentally different from yesterday’s (as well as being greater). Some of the selling is an attempt to gain shelter from the Russia war and sanctions storm. Airlines stocks, which will take a hit from higher prices for jet fuel and any drop in the appetite for flying, were down with American Airlines (AL) off 5.57% and United Airlines (UAL) lower by 5.74%. Some of the selling seems a reasonable guess at where there might be problems. U.S. banks are down heavily even though various experts say they have little or no Russia exposure. JPMorgan Chase (JPM) was down 3.77% and Bank of America (BAC) was off 3.91%. But some of the selling is just selling, either to reduce risk or to raise cash, without any specific connection to Russia and the Russia sanctions. Tesla (TSLA) was down 0.70% at the close as and construction aggregate producer Vulcan Materials (VMC) was significantly lower by 3.86%. Fewer states will repave their roads because of the sanctions on Russia’s central bank?
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My one-hundredth-and fifth YouTube video “Russia sanctions and the Federal Reserve’s interest rate increases” went up today. So how will the seemingly imminent confrontation between the United States and Russia over the fate of Ukraine, and the likelihood of continuing economic sanctions against Russia change the prospects for interest rate increases by the Fed in the coming months. Ya think that the prospect of sanctions on Russia and possible Russian cyberattacks might change the Fed’s schedule?
Today, stocks fell but not a huge amount on uncertainty about exactly what sanctions the United States and the countries of Europe will impose on Russia. So far, the reaction seems to be one of “disappointment” that the announced sanctions aren’t bigger.
U.S. Treasury Secretary Steve Mnuchin said today that Russian metals giant Rusal, could get sanctions lifted if Putin-connected oligarch Oleg Deripaska relinquished control. The Treasury also gave Rusal a five month extension as it considered Rusal’s appeal of the sanctions. Commodity prices–especially aluminum–fell on the news.