The Russian ruble-based MOEX index reached a new high on Friday, surpassing 3,000 points for the first time since February 22, 2023. This milestone comes just one day before Russia launched its military operation in Ukraine. The index rose by 0.7% to reach 3008.61 points. Since the start of the year, the MOEX index has surged by approximately 40%.
The stock market has been on an upward trajectory since experiencing a collapse following the announcement of partial mobilization in September 2022. Analysts have attributed this rally to several factors, including the devaluation of the ruble, rising oil prices, and the dividend policies of Russian companies. Business experts predict that the MOEX index could even reach 3,500 points by the end of the year.
During the latest trading session, major oil companies such as LUKOIL, Rosneft, Tatneft, Gazprom Neft, and Surgutneftegaz demonstrated strong growth. Additionally, Sberbank stocks in the financial sector saw a 0.6% increase, making them the top performers in their industry.
The surge in the MOEX index can also be linked to the performance of Brent crude oil, which serves as a global benchmark for Russian exports. The price of Brent crude oil rose by 1% to $83.72 per barrel, nearing a three-month high. This increase in oil prices has had a positive influence on Russian stock indexes.
Conversely, Russia’s national currency, the ruble, experienced a slight decline and was trading at around 90 against the US dollar. If the ruble continues to weaken, it could reach its lowest point since April 2022.
These developments in the Russian stock market and currency exchange rates highlight the interconnectedness between various economic factors. The devaluation of the ruble, rising oil prices, and the dividend policies of Russian companies all play crucial roles in driving the performance of the MOEX index.
As the year progresses, it will be interesting to monitor whether the MOEX index can continue its upward trajectory and reach the projected target of 3,500 points. Additionally, the performance of the ruble and oil prices will continue to be key indicators to watch in assessing the overall health of the Russian economy.
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