Russia shuts its stock market for a 3rd day as its government readies $10 billion to buy up plunging assets

• Russia's central bank closed the country's stock market for a third day, as it tried to limit panic selling.
• The country's war in Ukraine and ensuing Western sanctions have put huge pressure on the financial system.

Russia's central bank ordered the Moscow stock exchange to stay closed for a third day Wednesday as the country's sovereign wealth fund prepared $10 billion to try to limit a plunge in assets.

The Bank of Russia said it would decide whether to reopen trading before 9 a.m. local time Thursday. The three-day closure is the longest since 1998, according to Bloomberg, a year in which a financial crisis rocked the country.

Russia's economy has come under severe strain after President Vladimir Putin gave the order to invade Ukraine last week and Western governments imposed sanctions in response.

The stock market plunged as much as 50% when the invasion started, but has been shuttered since the close on Friday, when it stood 35% lower for the year. The Russian ruble has crashed to a record low and investors have dumped the country's bonds.

Alongside untold human misery in Ukraine, the conflict has unleashed economic warfare between Russia and the West. The US and its allies have cut select Russian banks out of a key global payments messaging system and have prevented the central bank from accessing much of its stockpile of foreign currency reserves.

Read more: Macro strategists at a $900 billion asset manager break down how war in Ukraine and the related energy market turmoil could derail the Fed's monetary policy plans — and reveal which countries' stock markets are best placed to ride out the storm

In an effort to prevent a tidal wave of selling when the market eventually reopens, Russia will use up to $10 billion from its sovereign wealth fund to buy stocks, the country's prime minister said Tuesday.

He also announced Russia would temporarily ban foreigners from exiting their investments in the country, after a number of major companies including oil and gas majors Shell and BP announced they were writing off their Russian assets.

Although Moscow was shut for trading, Russian companies cratered on the London stock exchange Wednesday.

Depositary receipts in Sberbank, Russia's biggest lender, plunged as much as 95% to as low as $0.01, while energy companies Gazprom and Novatek both crashed 97%. Depository receipts are certificates that represent shares.

"Russian equities are bleeding in London trading and uncertainty has hit maximum with European sanctions over the weekend reaching levels never seen before," said Peter Garnry, head of equity strategy at Saxo Bank.

Victoria Scholar, head of investment at trading platform Interactive Investor, said: "Russia's economy is likely to have already suffered a double-digit economic contraction on the back of Western sanctions, a slump in the rouble and corporate exits with more economic pain ahead."

In the US, VanEck's Russia exchange-traded fund was down more than 20% in pre-market trading Wednesday as investors slashed their exposure to the country.