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As in previous years, foreign investors accounted for about half of the share turnover (45% in December). The market value of the stock exchange and the growth in trading volume have been supported, in particular, by the growing interest of domestic small investors in the stock market. At the end of last year, 8.8mn Russians had investment accounts, which is almost fivemn more than at the end of 2019. The share of private individuals in share trading has increased and was 44% in December, up from 37% a year earlier. Last year, in addition to lower deposit rates and a change in the tax treatment of deposits, private investment was supported by the expanded use of electronic services. Three major commercial banks (Tinkoff, Sberbank and VTB) manage the majority of retail investment accounts.
After a two-year hiatus, two new IPOs were seen on the Moscow Stock Exchange last year. The issue of the state-owned shipping company Sovcomflot was the first listing of the state-owned company since 2013. The second listed company was one of Russia's largest developers, the real estate company Samolet. The October issue of Sovcomflot raised 43bn rubles ($550mn) and Samolet about 3bn rubles. The amounts are small compared to the November IPO of Russian online store Ozon in the United States, which raised about 990mn. dollars. The previousbn-dollar Russian listing in the United States was the listing of Yandex (registered in the Netherlands) in 2011.
The special features of the Moscow Stock Exchange will continue to be the high importance of oil and gas companies, the negligible role of domestic institutional investors (eg pension funds) and the small share of publicly traded shares in the share capital of companies. For the fifty largest shares, 30% of the market value is traded on average.
Russia’s main index on the Moscow Exchange got off to a very strong start to the year with the MOEX Russia index hitting a new all time following gains in equities trading in Europe and the US as investors anticipate more economic relief on January 6.
MOEX was closed on January 5 for a public holiday and is now catching up with global peers. The MOEX rose by more than 2% to a new record of 3,462 points on the last trading day of the week. The rally marked the second milestone for the main ruble-denominated index of the Russian stock market in just days.
Russian energy companies enjoyed the largest gains, with shares of nickel and palladium miner Norilsk Nickel jumping over 5% to a new all time high. Rosneft, N ovatek, and Gazprom were up over 4% boosted by positive dynamics in global oil prices.
US equities were also poised to extend their first week gains, with futures tracking Wall Street’s three main indices – the Dow Jones Industrial Average, the tech-savvy Nasdaq, and the S&P 500 – moving higher ahead of the crucial jobs report.
Global equities were on the rise after the US Congress confirmed President-elect Joe Biden’s election victory. It is believed that investors hope
95 RUSSIA Country Report February 2021 www.intellinews.com
