❗ Russian indices plunge after US warns of potential invasion
Russian indices are top laggards during the European trading session today. Russian RTS (RUS50) is trading over 3% lower while scale of moves on the other European blue-chips indices rarely exceeds 0.3%. Weekend news reports can be named as a reason behind today's sell-off of Russian assets. According to media reports, the United States has shared intelligence with its European allies that show a big build-up of Russian troops and artillery along the Ukrainian border. The US military sees the risk of Russia launching an invasion on Ukraine early into next year. Russia was quick to dismiss those reports and said that it is the United States who brings soldiers to Ukraine from overseas while Russia is amassing troops on its own territory. Time will tell whether the threat of invasion is real or is it just another of Putin's stunts aimed at gauging the response of the Western countries. However, markets give the news some gravity as evidenced by a strong sell-off on the Russian stock exchanges.
Russian RTS (RUS50) has been pressured by dropping oil prices (OIL, light blue overlay)recently but today's big sell-off is fuelled by media reports on potential invasion of Ukraine next year. The index is currently testing the 23.6% retracement of the post-pandemic recovery move. However, a key support to watch can be found slightly lower at 1,625 pts, where lower limit of the Overbalance structure and 200-session moving average can be found. Source: xStation5
