MOSCOW: Russia’s stock market is on track to reach record highs this year as the world is likely to gradually heal from the novel coronavirus with the help of vaccines and stimulus measures from major central banks, a Reuters poll of market experts forecast.
Russian stocks collapsed in the first quarter of this year under pressure from a drop in the price of oil, a key export, and the coronavirus. But they have managed to recoup most of those losses.
The MOEX rouble-denominated index, one of the best global performers in 2019, is expected to reach 3,150 by the end of this year, up about 3.4% from 3,047.06 on Nov. 23, according to the median of 13 analysts polled in the past two weeks.
“Both MOEX and RTS indexes have good chances to be above current levels by the end of this year if no new anti-Russian sanctions are implemented,” said Elena Kozhukhova, an analyst at Veles Capital.
Having priced in the victory of Joe Biden as the next US President, Russian stocks will continue watching developments around Covid-19 that sent Russia’s economy into contraction in 2020 and prompted the central bank to slash rates.
Russia’s record-low deposit rates boosted inflows of retail investors’ funds on the equity market, driving stock indexes higher, a trend likely to remain intact in the foreseeable future.
Authorities’ plans to tax returns from bank deposits could further turn investors away from deposits to stocks.
By the middle of 2021, the MOEX is seen reaching a record high of 3,300 before climbing further to 3,520 by end-2021.
Forecasts for the MOEX year-end reading ranged from 2,850 to 4,000.
“We believe there will be a massive Covid-19 vaccination in leading economies in early 2021. The global economic recovery and massive monetary and fiscal stimulus will support commodity prices and emerging-market assets, including the Russian market,” said Kirill Sokolov, chief economist at Sovcombank.
The dollar-based RTS index is forecast to trade at 1,320 points by the end of this year, up about 5% from 1,256.81 on Nov. 23.
The RTS is seen climbing further to 1,430 by mid-2021 and to 1,500 by the end of the next year.
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