Ruble Rises With Stocks as Russia Ends Exercises

Bloomberg: Russia’s ruble rallied with emerging-market currencies and stocks rebounded after President Vladimir Putin ordered some troops back to bases after military exercises ended while forces remain in Ukraine’s Crimea region. Gold fell with oil and U.K. natural gas plunged.

The ruble strengthened 0.5 percent against the dollar at 8:30 a.m. in London, while the yen, seen as a haven currency, slipped against all major peers. The MSCI All Country World Index increased 0.3 percent and Standard & Poor’s 500 Index (SPA)futures jumped 0.7 percent. Russia’s Micex Index (INDEXCF) climbed 3.7 percent after $55 billion was wiped from the country’s equities yesterday. Gold slid 0.8 percent, Brent crude dropped 1.3 percent and gas tumbled 4.2 percent in London.

Putin’s order came after the exercises in the coutnry’s west finished as scheduled, Interfax reported, and as U.S. Secretary of State John Kerry heads to Kiev after Russia told the United Nations that its intervention in Crimea is legal. The crisis sent global stocks down the most in a month and haven assets soaring yesterday. Chinese lawmakers meet on economic policy starting tomorrow. Federal Reserve vice-chairman nominee Stanley Fischer appears before the Senate.

Russian Securities

Kerry’s trip to Kiev, scene of the bloody uprising that precipitated the current crisis, comes after the leaders of the Group of Seven nations condemned Russia’s actions as a clear violation of Ukraine’s territorial integrity. Russia denied a report yesterday that it had given Ukrainian navy ships a deadline to capitulate.

Russia’s ruble climbed 0.7 percent to 49.9799 versus the euro, its biggest advance in a month, and to 36.275 per dollar from 36.51 yesterday. The Micex is heading for its first gain in six days and its biggest jump since September. The yield on Russian government bonds due August 2023 fell 10 basis points to 8.63 percent today, according to Bloomberg composite prices.

Bank Rossii, which yesterday boosted its key one-week auction rate by 150 basis points to 7 percent as stocks and the ruble tumbled, has about $150 billion for foreign currency interventions, ING Groep NV analyst Dmitry Polevoy wrote in a note to clients late yesterday.

Asian Stocks

MSCI’s world equity gauge fell 1.2 percent yesterday, the most in a month, as Russian shares plunged 11 percent. All 19 industry groups on the Stoxx 600 advanced today.

In Asia, Japan’s Topix index capped its first increase in five days, buoyed by electrical-appliance makers and real-estate companies. Hong Kong’s Hang Seng Index (HSI) climbed 0.7 percent, extending gains after the report on Russia’s troops.

Gold retreated to $1,339.46 after surging 1.8 percent in the spot market yesterday to the highest close since Oct. 28. Platinum fell to $1,448.50 an ounce and silver dropped 0.8 percent to $21.246.

The yen’s retreat came after its highest close since Feb. 5 versus the dollar.

A Bloomberg index of 20 emerging-market currencies increased 0.3 percent, the most since Feb. 21. Turkey’s lira and Hungary’s forint climbed 0.7 percent, while Poland’s zloty jumped 0.9 percent. Ukraine’s hryvnia tumbled 4.1 percent to more than 10 per dollar.

The S&P GSCI Spot Index of raw materials retreated 0.9 percent after it jumped 1.6 percent in New York yesterday, the most since August, amid concern energy and agricultural supplies will be disrupted.

Oil, Gas

West Texas Intermediate and Brent crude fell for the first time in three days amid speculation supply concerns because of tension between Russia and Ukraine may be exaggerated. WTI slid 1.1 percent to $103.80 and Brent fell to $109.77. U.K. gas futures slid in London after surging almost 10 percent yesterday.

Wheat, which soared the most since June 2012 yesterday, fell 1.4 percent while corn gave up 0.7 percent after jumping yesterday. Ukraine was set to become the third-biggest corn shipper this year, and ranks sixth for global wheat exports.

Events in the Black Sea area raise questions about medium-term supply capacity for agricultural crops, said Ken Ash, director of trade and agriculture at Organization for economic Cooperation and Development, in an interview in Canberra, Australia.

 reporters on this story: Nick Gentle in Hong Kong