Russian equity market dynamics
Last week, the Russian equity market outperformed the broader emerging market (EM) index by 2.2%. This was mainly due to the difference in the two indices’ sector structures. The overweight in the energy sector boosted the Russian market, as the sector rose by more than 2%. Additional support came from an absence of IT companies, as the EM IT sector declined by 4.6%.
Main Russian news
Russian budget revenues rose by 82.3% YoY in July. Over the last seven months revenues have reached a cumulative total of RUB 13.7 trillion (USD 185 billion). Oil and gas revenues totalled RUB 4.8 trillion (USD 65 billion), while non-oil and gas revenues were RUB 8.9 trillion (USD 120 billion). Overall budget spending increased by 20.7% YoY and totalled RUB 12.8 trillion (USD 174 billion). As a result, the budget surplus stood at RUB 890 billion (USD 12.1 billion) at the end of July. The Minister of Finance, Anton Siluanov, had previously said that the budget surplus is growing, and that the government may reduce the volume of its borrowing this year.
To watch…
There is no significant news to follow this week.
Author: Marina Tsutskiridze, Investment Specialist
Sources: Rosstat, Bloomberg, TKB Investment Partners (JSC); August 2021