and chelsea delaney and berlin, welcome to the shell. russia's benchmark stock and eggs jumped as much as 10 percent and it's 1st day of trading since february 28th. that's when moscow halter trading after russian stocks experienced one of the steepest sauce and market history. since then, moscow has been hit with a slew of western sanctions over its invasion of ukraine. all russian stocks did shoot higher on thursday. trading has been heavily restricted to prevent further plunges shares in russian equities, including glass form. and burbank can be traded from thursday by the end of the long disclosure of the country. stock market in its history comes with some limits . does still a ban on short selling and foreigners are not allowed to exit local equities, but that may not be enough to stop a sell off. european stocks with major exposure to russia lost more than $100000000000.00 in market value within days of russia's invasion of ukraine,

according to an estimate by bloomberg news early this month. meanwhile, the rubel has also plunged on february 24th. the day russia invaded ukraine, $1.00 was worth $84.00 roubles. on march 23rd, $1.00 was worth around $97.00 roubles. to day russian businesses are isolated due to western sanctions. most banks are blocked from swift, international payment system. and russia central bank cannot excess around half of its foreign reserves. several multi nationals have also decided to quit the market as part of a boycott, making it even less attractive to do business in russia. now let's bring in timothy ash. she's a senior sovereign strategist for emerging market at blue bay asset management, and thanks so much for joining us. so we did see russian and the russian benchmark index rise today. what do you make of that?

was pretty artificial. firstly, short selling of stock is not allowed that re limited section of stock serve for a for sale, or can you come trade for it as well as trade them and the russian sovereign wealth fund. as basic put, it's put aside $10000000000.00 to buy stock. so this is really been artificially maintained because russia wants to portrayed image that their stability and it's, it's, sir, it's regain durst. what regains to belittle his financial markets? i guess you mentioned 10000000 dollars that the russian sovereign wealth fund has used to help prop up the market. russia is obviously pretty cash strapped right now . what is, what is the purpose of, of using that precious foreign exchange of precious cash to, to pop up stocks? well they, they want to send a general message to the population of stability and confidence. remember that the, this, the, the invasion, the sanctions came as a massive shock to russia's population. they believe the lies of the kremlin that

they weren't going to invade. so the biggest holders of russian financial assets, the russians themselves, foreigners sold out. so russians wonder massive amount of pain because of her because of sanctions in the collapse of rich and financial markets. and there was concern about a run on banks and the broader collapse of macro financial stability. so. so it's all about sending a message that things are okay. everyone needs to come down. the russian authorities have got everything in control. but it's, it's a said it's artificial. it's artificially maintained. the longer term stories dreadful sanctions going to remain in place for a very long time. the outlook for the mission economies is terrible. there's no real reason to invest in russian assets at this point in time. there also and is a continuing discussions here and you are really around the world about what further sanctions should be put into place. and what do you see coming next in terms of sanction? well, i think energy should be sanctioned. and a germany central though, because for years it's been appeasing putin and it's dependent. it's over dependency on any on russian energy. it is his own faults, right?

shaw sanctioning russian energy would have a big hit. the german economy growth would slow, but germany has the strongest fiscal in the u. it can offset the the recessionary impacts of bonding russian energy by pump priming growth with fiscal channel. you know, i think this is time for germany to stand up. actually it's sir, you energy sanctions of the 11 of the key angle that the west can hurt boots in and maybe stopping with this invasion on the of ukraine. there has obviously been a lot of resistance to that here and, and germany which as, as one of the biggest, you importers of, of natural gas. do you, in a sense that, that, that resistance is shifting at this point? well if you think about sanctions, there was a lot of resistance to switch sanctions from germany amongst other countries, resistance to cb, off sanctions. remember a lot of these companies, i mean, self sanction has been the new thing that companies of been embarrassed by the fact that they're still doing business with russia and, and, you know,

who to the wall criminal and the stuff that they've been doing in ukraine. and i think the embarrassment is a must effect of working towards momentum in terms of sanctions. and i think in, in the end, the general government itself could be embarrassed into actually rolling over in terms of the energy sanctions. the option. one thing that's been talked about is a rock style food for oil program that, that might be interesting and might be a middle ground, i guess, between a full band on in pots from, from the, from russia that could probably help as some kind of transition from exactly what that look like, an oil, an oil for food program. yes, so she'll so, so any exports of oil or energy by russia would be paid for the money would go in the enough choice grow account that would be managed by the international community . and my russian needed to use them. it could only use them for few food or humanitarian reasons. it was imposed on sat on the same. if you remember after the 1st gulf war, i was pretty damaging in terms of the iraqi economy at that point in time. timothy

ash, from blue bay asset management, thank you so much for joining us. my pleasure. now, russian president vladimir putin announced wednesday that future payments for his country's gas exports must be made in rubles, many see an effort to undermine western sanctions and prop up russia struggling currency as explained by puts in the new rule would apply to countries sanctioning russia. but still receiving its gas exports a list that includes the e, u and japan did them as a no more than western countries have taken illegitimate decision on the so called freezing of russian. i certainly was a model security. this collective west has actually drawn a line under the reliability of its currency. so wasn't that you've already spoken about this across type the trust in these currencies, emotional navy, it couldn't renew them. what existing contracts are in dollars and euro's making the move dubious, at best. john, couldn't you wrong?

the announcement to pay in roubles is 1st and foremost a breach of contracts. and we will now talk with our european partners about how we respond to this on foreign. it's also unclear how payments would even take place. western banks don't trade heavily and rubles, russian banks could exchange the currencies. but that would undermine sanctions. giving russia much needed foreign currency and in turn, strengthening the weakened rubel. i don't think at this practicable and we already here, but not only germany, but if the lee and the austria have already declared that they, they will continue to o. d u o. with gus brom according to the existing contracts, which means that their payment will be made in the euro or dollar, which also means the pollutants demand further complicates the use long and painful to force from russian fossil fuels. earlier i stopped to yan pseudo come a professor for international economics at the diesel derf institute for

competition economics. i asked him what russia is hoping to achieve with its verbal payment demand. i think he's testing the west. so yesterday morning, chancellor of shots, he spoke in parliament essentially saying that we are not aiming for guests embargo essentially because we still need the gas, we cannot just turn it off. and now putting is playing games and testing how far we can do the course. you know, say what you can have the guess, but only if you're paying rubles will you countries do it well they pay in rebels. i think the likely scenario is and that they will not do that. i mean, we're talking about long term contracts and they are in euro or dollar. so putting kind of just come along and change the routes. i mean, if we would do that, that would be a very weak signal. actually. on the other hand, i mean, we still rely, especially germany, a few other eastern european countries on we still rely heavily on gas. so the

other option would be that we kind of don't play what has happened and say, well, it doesn't really make a difference whether we pay gas from in euro. and that does, from transfer the money to the central bank of russia, and they are just exchange to roubles. in the new scenario, we would essentially just exchange at a different russian bank. euro's for roubles, and then paid gust from roubles. it's not a big difference, factually. speaking it's just that just putting comes along and changes the rules. this is basically the, the difficult part. some i've said that this is a way to sort of under cut you sanctions and western sanctions on moscow or do you think that's? that's true. yeah, that's right. i mean, at the moment, basically we pay gas from in your dollar than that ends up at the central bank of russia, which is sanctioned. and so basically they have to find workarounds and loopholes

how they can make use of that hard currency to essentially um, effect the exchange rates on international markets. now waste their workarounds. they can operate by china and so on, so forth. but it's difficult. so under the new set of rules, basically we can make life easier for the central bank of russia because we would essentially allow the commercial banks of russia to stabilize exchange rates because they would basically, um, change make that transaction off dollar euro versus rouble for the central bank, so essentially factually basically it would undercut the sense that we propose because we wanted to effect the central bank. we didn't want the central bank to operator international financial markets. if we follow protein, we will affect you law allow mom commercial banks to do the job of the central bank . so what kind of impact will this have? i'm on you gas supply, which as we know is already quite stretched yet. well,

that depends on what all governments will decide whether they play according to put his book and downplayed the impact. i mean, then fetch we speak. i mean, basically things could business could go on as usual. and we just pay rubles, as i said, i mean, that's a technical detail. we could do it. but i think the more likely scenario is that we see an escalation of the conflict. basically your pin country saying no, we stick to the contracts there specified in dollar euro, that's what we're going to do. and then, well, we'll see what, how would you react on the same scenario you can say, well, i mean in the extreme scenario on putting will just close to drain for gas. that was yen sudak. i'm a professor at the dusseldorf institute for competition economics. and before we go, or remind her of our top stories, russia's benchmark stock index has jumped as much as 10 percent, and it's 1st day of trading and almost a month, only

a handful of shares were allowed to trade. this comes after russia said that future payments for it's countries gas exports must be made and rubles, many's the effort to undermine western sanctions and prop up russia struggling currency. and that's all from me to navigate your way through the digital jungle. get a global perspective will be your guide and show you what's possible. you decide what really matters to you more shift on d w. ah, i'm scared that i want. that's hard and in the end is a me, you are not locked up to you anymore. we will send you back. are you familiar with this with the smudges reliance as of the what's your story

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