Russian Equities Weekly 16–20/09/2019: Mixed macroeconomic indicators

  Week YTD
RTS Total return (TR) in USD 0.7% 36.1%
MOEX index TR in RUB    
Composite 0.2% 24.6%
Blue chip 0.4% 26.6%
Small and mid-cap -1.3% 10.8%
MOEX sector indices TR in RUB
Oil & Gas 1.3% 20.7%
Metals & Mining 0.2% 12.1%
Financial Services -0.6% 25.0%
Power Utilities -2.8% 26.7%
Consumer Goods -3.0% 9.9%
RUB/USD 0.6% 8.0%
RUB/EUR 1.4% 12.7%

Data as of September 20, 2019
TKB Investment Partners (JSC) calculations; Bloomberg

Russian equity market dynamics

Last week, the Russian equity market outperformed other emerging markets (EM). The RTS gained 0.7% while the MSCI EM index lost 0.5% (all figures in USD terms). The Russian market was supported by the spike in the price of Brent crude oil and the strengthening rouble after Saudi Arabia halved its oil output as a result of a terrorist attack. Part of the lost output has been recovered already, however prices are being kept at elevated levels by the tensions in the Middle East and uncertainty as to when full-scale production will be restored.

The oil & gas sector outperformed the market. This was mainly due to Novatek and Rosneft’s shares, which rose by 5.4% and 4.5%, respectively, both in rouble terms. Oil prices rose by 6.6% last week as a consequence of an oil production cut in Saudi Arabia. Novatek and Rosneft’s shares rose in line with the higher oil prices.

The consumer goods sector was the worst performer of the week, dragged down mainly by X5 retail group and Yandex. There was no fundamental news to justify the poor performance of these stocks.

Main Russian news

Key macroeconomic indicators were mixed in August. The rise in industrial production was mainly due to an improvement in natural resources extraction, which was enough to compensate for the fall in manufacturing. Retail sales slowed in both the food and non-food sectors. Rosstat revised real wage growth for July from 3.5% to 3.0% YoY, which was in line with the August results.

Indicator Growth YoY
July 2019 August 2019
Industrial production 2.8% 2.9%
Manufacturing 2.8% 2.7%
Extraction 3.0% 3.1%
Retail sales 1.1%* 0.8%
Food 1.2%* 0.6%
Non-food 1.1%* 0.9%
Real wages 3.0%* 3.0%

* Figures revised by Rosstat

To watch…

These is no significant news to follow this week.


Russian Equities Weekly 23 September 2019

Author: Aleksandra Kuznetsova, Junior Investment Specialist

Sources: Vedomosti, Rosstat, Bloomberg, TKB Investment Partners (JSC); August 2019

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