MOSCOW: The Russian rouble hit a new record low against the dollar on Friday, hurt in part by companies' foreign debt repayments, while shares in conglomerate Sistema plunged after another twist in a criminal investigation into its chairman.
The Russian currency has touched several historic lows in the past few months as investors in Russian assets have taken fright over the Ukraine crisis and as prices of oil, a major Russian export, have fallen below $100 a barrel.
By 0925 GMT, the rouble was 0.97 percent weaker against the dollar at 38.86 after reaching a low of 38.97. It was down 0.87 percent versus the euro at 49.52.
That left the currency 0.92 percent weaker at 43.66 against the dollar-euro basket, which the central bank uses to gauge the rouble's nominal exchange rate.
"A combination of factors are pressuring the rouble. Firstly, dollar appreciation against developed and emerging market currencies, and secondly Russian corporates and banks are de facto shut out of foreign capital markets," said Maxim Korovin, a forex analyst at VTB Capital in Moscow. Korovin said the second factor - resulting from Western sanctions on Russia restricting access to Western financial markets - was exerting a constant drag on the rouble as many Russian companies were having to buy foreign currency to meet external debt repayments.
They were also unable to attract new funding in foreign currencies due to sanctions over the Ukraine crisis.
Moscow-listed shares fell, meanwhile, with the market mood soured by a Russian court's decision to seize conglomerate Sistema's shares in oil company Bashneft as part of a criminal investigation.
Hopes of a rollback in the West's sanctions on Russia had fuelled market optimism in recent days but were fading on Friday after EU diplomats downplayed the likelihood of an immediate easing.
A draft law submitted to the Russian parliament on Wednesday that would give Russian courts the right to seize foreign assets on Russian territory has also dampened sentiment.
The dollar-denominated RTS share index was down 1.2 percent at 1,160 points, while the rouble-based MICEX was 0.2 percent lower at 1,433 points.
Sistema was the worst performer among Russian blue chips, falling some 18 percent after steep falls in the previous session, while Bashneft fell 7 percent.
Top bank Sberbank, meanwhile, slipped 0.4 percent. Sistema, which acquired an almost 80 percent stake in Bashneft for $2.5 billion in 2009, has been unable to deal in its Bashneft shares since July because of a related investigation.
Its chairman, oligarch Vladimir Yevtushenkov, has been placed under house arrest.
"An unpleasant mood will continue to hang over the Russian stock market due to the 'Yevtushenkov case'," Anastasia Sosnova, an analyst at Rossiysky Kapital bank, said in a note.
"Market players see a so-called 'political element' in this case, which in turn undermines the desire to invest in Russian assets."
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