Russian stocks fell almost 10 percent on Monday as the nation's military encroachment in to Ukraine spooked investors.
Reuters reported that the nation's stocks plunged and its central bank intervened with a $10 billion ruble buy to support the currency as investors took fright at escalating tensions with the West over the former Soviet republic.
According to Reuters,
The Russian central bank raised its key lending rate by 1.5 percentage points after the ruble fell to all-time lows against the dollar. The MICEX index of Moscow stocks tumbled 10 percent to 1,294 points. Russian gas monopoly Gazprom, which supplies Europe through Ukraine, was down more than 13 percent.
Gazprom's finance chief warned Ukraine that it may hike gas prices from next month, accusing Kiev of a patchy payments record, but said gas transit to Europe was normal.
Ukraine Prime Minister Arseny Yatseniuk, head of a pro-Western government that took power when former president Viktor Yanukovich, a Russian ally, fled on Feb. 21 after three months of street protests against his rule, said Putin had effectively declared war on his country.
Western leaders have reacted with a barrage of warnings to Putin against armed action, threatening economic and diplomatic consequences if Moscow goes further, but are not considering any military response.
U.S. Secretary of State John Kerry condemned Russia for what he called an "incredible act of aggression" and threatened "very serious repercussions."
G8 countries and other nations were prepared to "to go to the hilt to isolate Russia" if Moscow made the wrong choices in Ukraine, Kerry told CBS program Face the Nation.
"They are prepared to isolate Russia economically. The ruble is already going down. Russia has major economic challenges," he said. He mentioned visa bans, asset freezes and trade isolation as possible steps.
