The Moscow Exchange index for the first time in six months exceeded the level of 2300 points. This was largely determined by the dynamics of Sberbank shares, whose quotes rose by almost 10% against the background of the Supervisory Board's proposal to pay record dividends for last year. The positive dynamics of the Russian stock market was influenced by the maintenance of the key rate of the Central Bank at the level of 7.5%. Experts expect that if the situation on the markets stabilizes, the index may approach the level of 2400 points, and reach the level of 2500 points by the end of the year.
As a result of trading on Friday, March 17, the Moscow Exchange index reached 2322.78 points, having updated the maximum since September 20 last year. Compared to the previous day, the index rose by 2.86%. At the same time, the volume of trading in shares included in the Moscow Exchange index exceeded 108 billion rubles, the maximum value for the first half of the year.
The sharp growth of the index was due to the rapid growth of Sberbank stock prices. On Friday, the supervisory board of Sberbank recommended the payment of dividends in the amount of 565 billion rubles, which was a record in the history of the bank, at the rate of 25 rubles. for common and preferred shares. These dividends implied a 13% return on shares at the beginning of the day, which is significantly higher than the average for the index.
As a result, the quotes of the bank's ordinary shares grew by more than 9% by the end of the auction, while those of preferred shares grew by almost 10%. As Natalya Malykh, head of the Finam share analysis department, points out, Sberbank's weight in the Moscow Exchange index is 16%. The volume of trading in Sberbank's ordinary shares amounted to more than half of the total trading volume, exceeding RUB 60 billion.
Russian public issuers still rarely pay dividends, even in the presence of net profit.
In particular, the boards of directors of Raspadskaya, Polymetal, TCS Group, Ros Agro decided not to pay dividends for the year. Nevertheless, analysts are seeing a gradual normalization of dividend payments from Russian companies. At the same time, PhosAgro, Moscow Exchange, Pozitiv, NOVATEK declared dividends, but the dividend yield is 2-7%. It is unlikely that Gazprom will be as generous, Andrey Kochetkov, a leading analyst at Otkritie Investments, doubts. According to him, not everyone is involved in this process, but during the year it can be assumed that other key participants in the domestic market will return to payments.
The positive dynamics of the stock market is also associated with the decision of the Bank of Russia to keep the key rate at 7.5%. This means that it will be somewhat easier for stocks to compete with OFZs, which offer higher yields than the index as a whole, Ms. Malykh points out. “When and if expectations of a rate hike resume, then part of the capital may move from shares to OFZs,” the expert believes.
Further dynamics of the Russian market will depend on whether the authorities and regulators are able to prevent the problems of the Western banking sector from growing to the scale of the global financial and economic crisis, Dmitry Babin, an expert on the stock market at BCS Mir Investments, believes.
“Unlike other similar failures, which were previously stopped by massive injections of liquidity, this is now being hampered by high inflation, which could spiral out of control as a result of monetary easing,” he warns.
If the situation on the oil market and on the stock exchanges at least stabilizes, the Moscow Exchange index may head towards 2368-2378 points, Mr. Babin added. This will be facilitated by the likely continuation of the downward dynamics of the ruble exchange rate, due to a drop in export earnings due to sanctions, a geopolitical discount in prices for Russian raw materials, as well as a deterioration in the raw material market. At the same time, in the short term, drawdowns of the Moscow Exchange index on the wave of profit fixation cannot be ruled out, Mr. Kochetkov believes. By the end of 2023, the expert does not exclude its increase to 2400-2500 points.