Russia stocks lower at close of trade; MOEX Russia Index down 0.75%

The MOEX Russia Index closed down 0.75% on Friday, dragged lower by losses in the Mining, Oil & Gas, and Telecoms sectors. Polyus PJSC was a top performer, while Moskovskiy Kreditnyi Bank PAO and NOVATEK PJSC experienced significant declines. In commodities, gold and oil prices rose, while the ruble showed mixed performance against the dollar and euro.

Analysis

The MOEX Russia Index concluded Friday's session with a 0.75% decline, reflecting a moderately negative sentiment as indicated by a score of -0.4. This downturn was primarily driven by losses in the Mining, Oil & Gas, and Telecoms sectors. Among individual equities, Moskovskiy Kreditnyi Bank PAO experienced the sharpest fall of 5.69%, while NOVATEK PJSC and AK ALROSA PJSC also saw significant declines of 2.69% and 1.44% respectively; per-ticker sentiment for NOVATEK registered at -0.4 and for AK ALROSA at -0.2. Conversely, Polyus PJSC emerged as a top performer, gaining 2.97%, followed by Federal Hydro Generating Company RusHydro PJSC with a 1.71% rise. Market breadth was negative, with 135 stocks falling compared to 102 advancers, and 14 remaining unchanged. Indicative of heightened market apprehension, the Russian Volatility Index (RVI), measuring implied volatility of MOEX Russia Index options, rose by 1.17% to 39.05. In commodity markets, Gold Futures for June delivery increased by 1.89% to $3,357.20 a troy ounce, and Crude oil for July delivery rose by 0.92% to $61.76 a barrel, with the July Brent oil contract also up 0.88% to $65.01 a barrel. The Russian Ruble exhibited mixed behavior, appreciating 0.13% against the US Dollar to 79.57, while depreciating 0.54% against the Euro to 90.36, amidst a 0.86% fall in the US Dollar Index Futures.

Key Decisions for Investors

• Given the MOEX Russia Index's 0.75% decline, broad sector weakness, and a 1.17% rise in the Russian Volatility Index to 39.05, investors should consider exercising caution and closely monitoring for continued market instability.
• The significant 2.69% decrease in NOVATEK PJSC (NVTK) shares, despite an increase in global oil prices and a specific negative sentiment of -0.4 for the ticker, warrants careful scrutiny for potential company-specific issues or adverse sector dynamics within Russia.
• Investors should assess the implications of rising commodity prices, particularly gold and oil, alongside the mixed performance of the Ruble (strengthening against the USD while weakening against the EUR) for their Russian asset allocations and currency hedging strategies.