Traders Spooked as Russia's Woes Deepen

The Market Vectors Russia ETF Trust (RSX) and Direxion Daily Russia Bear 3x Shares (RUSS) have hit notable milestones today

by Karee Venema

Published on Dec 15, 2014 at 3:13 PM
Updated on Apr 20, 2015 at 5:32 PM

Oil is continuing to pan fresh five-year lows today, with the January-dated contract closing 3.3% lower at $55.91 per barrel. While this plunge in oil prices has helped the U.S. consumer, it is having a decidedly negative effect on Russia's economy -- the world's largest energy exporter. Today, in fact, the Market Vectors Russia ETF Trust (NYSEARCA:RSX), which is the biggest exchange-traded fund (ETF) based on the country, plunged to $13.85 -- its lowest mark since March 2009 -- and was last seen 12% lower at $13.90.

Echoing this is the action in the ruble, which earlier hit a record low against the U.S. dollar. Additionally, the currency settled the session down 9.1% -- its largest percentage decline on a closing basis since 1998, the year Russia defaulted on its debt.

Conversely, the Direxion Daily Russia Bear 3x Shares (NYSEARCA:RUSS) rallied to a new three-year peak of $48.75 earlier, but more recently was up 35.1% at $47.94. Going forward, Russia's volatility could continue, should oil extend its decline -- or President Barack Obama decide to move forth with another round of sanctions, authority that was granted to him unanimously by the Senate over the weekend.


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