Russian stocks are 'uninvestable' following the invasion of Ukraine and will be removed from indexes at MSCI and FTSE Russell
- Russian stocks are being cut from indexes created by
MSCIand FTSE Russell, the companies said separately.
- Russian stocks are "uninvestable" in the wake of Moscow's invasion of
Ukraine, MSCI said.
Russian stocks will be removed from indexes created by MSCI and FTSE Russell, marking further fallout in global
Russia will be deleted from all FTSE Russell Equity Indices on March 7 and MSCI Russia Indexes will be reclassified on March 9 from emerging market status to standalone markets status "at a price that is effectively zero," the index providers said in separate statements Wednesday.
MSCI said the decision comes after consulting with international institutional investors on the accessibility and investability of the Russian equity market. It received feedback from asset and managers, broker dealers, and exchanges, among others.
An "overwhelming majority" confirmed "that the Russian equity market is currently uninvestable and that Russian securities should be removed from the MSCI Emerging Markets Indexes," the company said.
FTSE Russell said its consultations included talks with independent advisory committees and other stakeholders on the treatment of Russia stemming from escalating sanctions on Russia by the European Union, the United Kingdom and the US, as well as the temporary suspension of trading on the Moscow Exchange, or MOEX.
Moscow's invasion of Ukraine last week has led to the closing of Russia's main stock market, with Thursday marking the fourth day of no trading. Meanwhile, the London Stock Exchange has suspended trading in a number of Russian companies. The New York Stock Exchange and Nasdaq have also halted trading in Russian stocks. The round of moves from global market participants stand to slash the amount of investment going toward Russian companies.
Earlier this week, asset manager BlackRock said it will stop issuing new shares of an exchange-traded fund tracking Russian stocks. The iShares MSCI Russia ETF, which trades under the ticker ERUS, temporarily suspended the creation of new shares until further notice in light of "significant declines" in the ruble and the liquidity of Russian securities.
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