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The Russian Trading System fell 16.8 percent Oct. 6. While this drop is the worst the country has seen since its financial crisis in 1998, it is not a clear reflection of the Russian economic state.

Russia’s main market, the Russian Trading System (RTS), took another plunge Oct. 6, falling 16.8 percent since its opening. The Russian market has now fallen below its 1,000-point benchmark, making the tumble the worst since Russia’s 1998 financial crisis.

The RTS was created in 1995 and modeled on the NASDAQ mainly to bring foreign cash into Russian companies — a reason why it was exchanged in dollars instead of rubles. It holds approximately 40 companies on the actual exchange, a who’s who of the Russian government’s and oligarchs’ precious jewels.

companies

However, approximately 40 percent of the stocks traded on the exchange are represented by three companies: Gazprom, Rosneft and LUKoil. Even a small dip by any of those three firms can cause the entire exchange to shudder and plummet; hence, the recent drop of oil below $90 a barrel has severely hurt the market.


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