Russia’s fledgling stock market suffered a shock yesterday as Russian stocks reacted to the crisis on world markets by falling almost 20 percent — the biggest one-day drop in the market’s short life. Trading was suspended for three hours but the market began to rally in the evening and has continued its recovery this morning. The Russian government reacted calmly, with Central Bank chairman Sergei Dubinin assuring investors there was no reason for panic. There was no underlying domestic cause for the decline, he said, and the fall in Russian stocks was led by western investors reacting to events outside the country. (Financial Times, BBC, October 29) First Deputy Prime Minister and Finance Minister Anatoly Chubais refused to cut short his visit to London and, if official reports are to be believed, yesterday’s meeting of the Russian cabinet did not digress from its scheduled discussion of the 1998 federal budget. (RTR, October 28) Chubais told journalists that Russia could benefit from this week’s crisis if investors came to appreciate that Russia is a safer place for their money than other emerging markets.
Primakov Continues Visit to Middle East.