FTSE Russell has taken a sanction step against Russia over the invasion of Ukraine that has stepped into the second month. It has removed Russian firms including Evraz and Polymetal from its indexes.
Billionaire Roman Abramovich, who owned the Chelsea Football Club until now, has a 29 percent stake in the Evraz steel giant. FTSE Russell released a statement arguing the measure has been taken on the basis of feedback received from their External Advisory Committees as well as several market participants.
The feedback reveals trading with such companies is restricted as most international brokers are not supporting and this has led to insufficient liquidity.
The FTSE Russell statement further added that the move will henceforth prevent trackers from replicating. Polymetal is a metal mining group while Petropavlovsk is a gold miner. These have been removed from the index. Similarly, the property investment giant Raven Property has been deleted.
The change in all the FTSE Russell indices is in effect from March 21, 2022, following index reviews earlier in March at zero value.
FTSE is the subsidiary of the London Stock Exchange and it had earlier announced it to be offloading the Russian bonds from the indexes of fixed income. The statement came after the international investors were unable to repatriate the proceeds in rubles.
The Russia-Ukraine was is in the second consecutive month and amid the period of one month most key cities and towns of Ukraine have been destroyed by the Russian troops, tanks and missiles. The West has imposed several tough sanctions on Russia including a ban on the imports of its oil and gas as well as the removal of Russian banks from the international SWIFT payment systems.
Meanwhile, a significant shortage of oil and gas is being witnessed in the United Kingdom and most European countries. This has led to rise in the prices of fuel, food and many necessary items. Inflation is growing at a rapid pace and economists believe it may reach to double-digitÂ figure if the war continues longer.
The Bank of England is working on policies to keep inflation under control. It may increase the interest rates even though analysts warn the economy may land into the stagflation phase.
A recent statement of US president Joe Biden has ignited controversy from corners of the world. He said Russian President Putin should not remain in power. Critics described the phrase as regime change. The US government clarified his words were for the moral responsibility of Putin to step down.
Apart from all these, millions of Ukrainians have been displaced and taken refuge in neighboring countries amid a couple of failed peace talks between Russia and Ukraine.