Stocks Take a Drop on U.S. Worry

Russian stocks fell for the first time in three days on investors' concerns that riskier markets could suffer if the U.S. falls into a recession.

Rosneft, LUKoil, and Surgutneftegaz fell as oil prices slipped on concerns about global economic growth.

The ruble-denominated MICEX dropped 4.1 percent to 1,635.33. All but two of its 30 members retreated. The dollar-denominated RTS slipped 2.7 percent to 1,978.68.

"The markets are confirming their reputation for mindless hysteria," said Eric Kraus, founder of the Moscow-based Nikitsky Russia Fund. "In the equity market we're not doing any short-term trading right now, because it has nothing to do with economic reality."

Russian stocks dropped along with European and Asian stocks after Goldman Sachs said the Japanese economy had probably fallen into a recession. The New York-based securities firm said in a note that the U.S. economy would contract in the second and third quarters.

"Objectively, the emerging-market economies are not yet showing any direct effects of the U.S. recession," Kraus said. He advised investors to "take a vacation" and said he was buying ruble-denominated bonds from Russian banks.

Rosneft, the country's biggest oil producer, sank 4.8 percent to 180.68 rubles. LUKoil, the second-biggest producer, decreased 3.8 percent to 1,741.77 rubles.