Trump-Putin Call Boosts Russian Stock Market and Ruble Value

MOEX Index Hits Highest Level Since May Last Year
Ruble Value Reaches Peak Since September Last Year

The news that U.S. President Donald Trump and Russian President Vladimir Putin had a phone call caused the Russian ruble's value and the stock market to surge. This reflected expectations that sanctions against Russia would be lifted as the two presidents agreed to negotiate a resolution to the Ukraine conflict.

Two people are having a conversation in front of a currency exchange office in Moscow, Russia. Photo by EPA Yonhap News.

According to the Russian daily Kommersant on the 13th (local time), the Moscow Exchange (MOEX) index rose 2.8% from the previous day's closing price to 3,289.64 points in the morning session, marking its highest level since May last year.

During the first two hours of trading that day, the trading volume exceeded 41 billion rubles (approximately 650.3 billion KRW). The market capitalization of the Russian market on the MOEX index increased by 500 billion rubles (approximately 7.93 trillion KRW) to 7.05 trillion rubles (approximately 111.813 trillion KRW) compared to the previous day.

The rise in market capitalization was led by Russian state-owned energy company Gazprom, the largest bank Sberbank, and liquefied natural gas (LNG) company Novatek, all of which are subject to Western sanctions.

The ruble also strengthened. According to MFD, a provider of investment and financial information, the exchange rate in the over-the-counter market reached 92.6 rubles per dollar, the highest since September 11 last year.

The ruble's value had plummeted due to heightened tensions between Russia and the West over the Ukraine war. Before the war began, the exchange rate was between 75 and 80 rubles per dollar, but it fell to as low as 120 rubles per dollar last autumn.

Meanwhile, there are also opinions that it will take time for relations between the U.S. and Russia to normalize. Ovanes Oganishan, an analyst at Russian investment firm Chipra Broker, said, "There will be more phone calls, meetings, and negotiations ahead," adding, "Everything will be very complicated, and full normalization will take considerable time."