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UPDATE 1-Russian stocks suspended in worst plunge since 1998

Tue Sep 16, 2008 9:29am EDT
 
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MOSCOW, Sept 16 (Reuters) - Russia's most liquid stock exchange MICEX suspended trade on Tuesday after the worst one-day fall in 10 years as Finance Minister Alexei Kudrin reassured markets there was no "systemic" crisis.

Share trade on MICEX was suspended for one hour starting at 4:42 p.m. (1242 GMT) because of steep falls driven by liquidity fears, an exchange official said.

The index was down 16.6 percent at 890.29 having fallen as low as 889.66 -- its biggest percentage loss since the Russian financial crisis of 1998.

Trading was also suspended for one hour in the dollar-denominated RTS index .IRTS.

State bank VTB (VTBR.MM: Quote, Profile, Research, Stock Buzz) shares were down 32.5 percent when trade was suspended, while state savings bank Sberbank (SBER03.MM: Quote, Profile, Research, Stock Buzz), one of the biggest index components, was down 20.9 percent.

"There are risks in our system and when there are more shocks from the global crisis, there are more risks in Russia, but they do not have an extraordinary, systemic nature," Kudrin was quoted as saying by Interfax news agency.

Traders and investors, their positions already slashed by heavy margin calls, were retreating into cash, market participants said.

"It's people moving into cash and ... getting worried about who they are dealing with," a Moscow-based trader at a Western bank said.  Continued...

 

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