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Business News

Russian stocks edge higher despite Western sanctions


Russian stocks laughed off the latest round on Western sanctions on the Kremlin over the crash of the Malaysia Airlines in Ukraine following a three-day sell-off.

The Russian MICEX index climbed more than 2 per cent on Wednesday after the United States and the European Union imposed new sanctions targeting the country's oil, arms and banking sector.

The US Treasury added three banks, including state-owned VTB, the Bank of Moscow and the Russian Agriculture Bank, to its sanctions list in response to the shooting down of Flight MH17, where 298 people were killed.

VTB fell 1.5 per cent but the country's biggest bank, Sberbank, jumped as much as 3 per cent after it escaped the latest round of sanctions.

Video: European market closes lower

"There is an underlying sense that the West still does not really want to bite the bullet and roll out a meaningful sanctions regime," Timothy Ash, a senior analyst Standard Bank in London, said a note to clients.

He added: "(The West) has the tool kit to hurt Russia, but would rather not for fear of the collateral damage back to its own business interests."

State-owned oil giant Rosneft gained 1.6 per cent closely followed by Lukoil, Russia's second largest oil producer, which also jumped 1.5 per cent.