Moscow Stock Market News: Exchange Bans Short Selling in #Russia’s Biggest Firms - Bloomberg

Moscow Stock Market News: Exchange Bans Short Selling in Russia’s Biggest Firms - Bloomberg

The Moscow Exchange banned short selling in some of Russia’s biggest companies, a move that may indicate officials are getting ready for the market to reopen.

Investors won’t be allowed to bet on declines in about 30 Russian companies, including Gazprom PJSC, Lukoil PJSC, Sberbank PJSC, MMC Norilsk Nickel PJSC and Rosneft Oil Co., and some Eurobonds. The decision takes effect on Tuesday, the exchange said in a statement.

The stock market has been closed for more than three weeks, the longest shutdown in the Russia’s modern history, as the economy reels from international sanctions that limit Russia’s ability to access foreign reserves and use the SWIFT bank-messaging system.

It’s yet unclear when stocks will start trading again, but the short-selling announcement suggests exchange is preparing for activity to return, according to Cristian Maggio, head of portfolio strategy at Toronto Dominion Bank in London.

“They may want to remove any residual risk of speculating on a further price fall,” said Maggio.

Other exchanges have used short-selling bans to limit volatility during a crisis. Back in March 2020, at the peak of the Covid pandemic-fueled selloff, Italy, France and Belgium also prohibited shorting.

Some companies seem to have been excluded from the ban. Yandex NV, TCS Group Holding Plc, Ozon Holdings Plc were among stocks not listed in the statement from the exchange.

Still, investors say it’s a near certainty that stocks will tumble when the market reopens. The share prices of Russian companies listed in London have been wiped out and index providers have removed Russia from market benchmarks. On Monday, the nation’s local bonds slumped as trading resumed for the first time in three weeks.