The Russian stock and currency markets experienced significant declines during Wednesday’s trading session, spurred by reports indicating that peace talks regarding Ukraine had encountered yet another obstacle.
By 12:30 p.m. Moscow time, the value of the U.S. dollar had increased by 1.5% to 82.71 rubles in the foreign exchange market, while it surged to 83.1 rubles on the Russian interbank market, marking its highest point in a week, as reported by Reuters.
The euro climbed 2.2% against the ruble, reaching 94.5 rubles, and the yuan also rose by 2% on the Moscow Exchange to 11.35 rubles, both achieving weekly highs.
The MOEX index, which was near the 3,000-point level on Tuesday evening, fell to 2,900 points at the start of trading. Shares of Gazprom decreased by 3.2%, Sberbank fell by 1.5%, VTB declined by 3.1%, and Rosneft dropped by 2.9%. Aeroflot, NLMK, MMK, and Alrosa all saw their values decrease by over 3%.
“The downward trend is primarily influenced by geopolitical concerns, as today’s scheduled negotiations in London aimed at resolving the military conflict in Eastern Europe have collapsed,” explained Vladimir Chernov, an analyst at Freedom Finance Global.
According to the British Foreign Office, top diplomats from the U.S. and Europe did not attend the latest round of peace discussions in London, which were intended to focus on a ceasefire initiative now being deliberated among senior officials.
Last Thursday, U.S. Secretary of State Marco Rubio met with the French and British foreign ministers, along with a senior German representative in Paris, where he presented a U.S. proposal for ending the conflict.
This framework, as reported by Axios, entails U.S. recognition of Russia’s annexation of Crimea, implicit acknowledgment of Moscow’s control over four other partially occupied Ukrainian regions, easing of sanctions, and a commitment to future economic collaboration. However, the outlet also pointed out that the security guarantees for Ukraine remain ambiguous.
Many elements of the proposal are unacceptable to Ukraine and European nations.
A U.S. official involved in the discussions told Axios that both Rubio and Trump’s envoy Steve Witkoff decided not to attend the London meeting after Ukraine expressed a preference to concentrate on a 30-day ceasefire proposal instead of the broader U.S. framework.
Rubio cautioned last week that Washington could withdraw from ceasefire negotiations “within days” if neither Kyiv nor Moscow showed a readiness to expedite a resolution to the conflict.
Chernov predicts that the ruble and the Russian stock market may continue to decline through the end of the week, with the U.S. dollar possibly rising to 85-86 rubles and the MOEX index dropping to 2,860 points.
