The Russian equity market ended in the black for the third consecutive week, outperforming its peers. The MSCI World index rose by 0.1% and the MSCI EM index gained 0.3%, in US dollars terms. A rise in oil prices continued to support the Russian market.

The consumer goods sector outperformed other sectors last week, driven by positive operational results of the X5 Retail Group and M.Video in Q1 of 2019, boasting 15.3% and 12% revenue growth respectively.

Financials underperformed last week due to Sberbank and VTB, whose share prices fell by 2.9% and 1.3% respectively.

  Week YTD
RTS Total return (TR) in USD 0.6% 18.3%
MOEX index TR in RUB    
Composite 0.2% 8.5%
Blue chip 0.1% 10.1%
Small and mid-cap 0.9% 5.6%
MOEX sector indices TR in RUB    
Consumer Goods 1.5% 4.7%
Power Utilities 1.0% 8.9%
Metals & Mining 0.8% 3.3%
Oil & Gas 0.4% 3.4%
Financial Services -0.1% 11.5%
FX    
RUB/USD 0.5% 8.1%
RUB/EUR 0.7% 10.3%

Data as of April 19, 2019
TKB Investment Partners (JSC) calculations; Bloomberg

Main Russian news

Russian macroeconomic indicators worsened in March. Industrial production growth decelerated due to slower growth in both the manufacturing and extraction sectors. Retail sales growth also decreased to 1.6% YoY. This slowdown was felt in both food and non-food segments. From this year onwards, real disposable income is provided only quarterly. In Q1 of 2019, the indicator decreased by 2.3% compared with the same period last year. The reason for this deterioration was the slowdown in real wages growth. Rosstat published for the first time the real disposable income calculated by this new method, and recalculated the indicator for 2018. The new calculation showed that there was an increase in income of 0.1% last year, as opposed to the fall of 0.1% calculated by the previous method.

Indicator Growth YoY  
  February 2019 March 2019
Industrial production 4.1% 1.2%
Manufacturing 4.6% 0.3%
Extraction 5.1% 4.3%
Retail sales 2.0% 1.6%
Food 1.7% 1.2%
Non-food 2.4% 1.9%
Real wages 0.0%* 0.0%

* Data was revised by Rosstat

To watch…

No material is planned


Author: Marina Tsutskiridze, Junior Investment Specialist

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

Russian-Equities-Weekly-22-April_2019

Categories: Market Outlook