Russian markets fall after US strike against Syria

The Russian currency and stock markets fell on Friday as American military action in Syria dashed hopes for a better relationship between Washington and Moscow.

President Donald Trump launched a military strike on a Syrian government airbase overnight in response to a chemical attack on civilians earlier this week.

Russia denounced the attack, promised to bolster Syrian air defenses, and sent a warship to the Mediterranean.

The Russian ruble fell 0.8% against the U.S. dollar, while the main Russian stock market index dropped nearly 2%, despite gains in the price of oil -- the foundation of the Russian economy.

"One immediate impact is that it has dashed hopes that relations between Russia, a supporter of the [Syrian] regime, and the U.S. will normalize," said William Jackson, senior emerging markets economist at Capital Economics.

President Trump had said he would be willing to roll back sanctions imposed on Moscow over Ukraine, but only if Moscow was ready to cooperate on other issues.

Russian stocks and the ruble jumped immediately after Trump's election victory in November as investors hoped for a quick thaw in relations.

"We may have just reached a new low in relations now, while expectations for a swift reset had been too optimistic," said Gunter Deuber, the head of central and eastern European research at Raiffeisen Bank.

This BBSNews article was syndicated from News | WPLG, and written by News | WPLG. Read the original article here.