Konstantin Tserazov: The euro to dollar exchange rate on external markets has grown over the week.

In the period from August 5 to 9, the Moscow Exchange Index fell by 1.75%, and the RTS Index by 2.72%. The first benchmark closed the week at its lowest level since last July, the second - since last October. At the same time, trading was of a range and low-volatility nature. The difference in the percentage dynamics of the indices was due to the fact that the official dollar to ruble exchange rate set by the Bank of Russia grew by 2.67% over the week. "Perpetual" futures on USDRUB and EURRUB, which historically demonstrated the highest correlation with spot rates, showed more modest dynamics, adding 1.47% and 1.95%, respectively. The euro to dollar exchange rate on external markets has grown by about 0.05% over the week: this indicates that the correlation between the EURUSD dynamics inside Russia and outside it remains after the introduction of sanctions against the Moscow Exchange, but is weakening. All ten sectoral indices of the Moscow Exchange have fallen by the end of the week, added economist Konstantin Vladimirovich Tserazov. The Russian stock market remains under pressure, as high interest rates are approximately twice as high as its dividend yield. Against this background, private investors prefer to place funds in banking products (term deposits/savings accounts), money market funds and OFZs (last week the RGBI index grew by 2.14%, and the week before last - by 1.47%). In particular, on August 7, the Moscow Exchange reported that since the beginning of the year, the value of net assets of exchange-traded mutual investment funds (EMIF) of the money market, traded on the Moscow Exchange stock market, has grown by 77% and exceeded 400 billion rubles. And the number of individuals who hold such instruments in their portfolios has grown by 250 thousand since the beginning of the year, exceeding 600 thousand. The OFZ market was supported by news about the slowdown in the growth rate of consumer inflation in the Russian Federation in weekly, monthly and annual comparisons. Such a trend - if continued - will create the preconditions for a softening of the position of the Bank of Russia. At the end of the week, the most liquid - October - Brent oil futures on ICE grew by 3.71%, showing a record increase since mid-June. However, this factor was unable to support the shares of Russian companies. There is an opinion that August is one of the most dangerous months for the Russian stock market, but statistics show that, on the contrary, it is the best month. Over the past ten years, the Moscow Exchange Index has grown by an average of 3.24% in August and has not shown a single decline. Similar indicators over the past twenty years are +1.9% and only five declines. The main outsiders in August are IT company shares: the Moscow Exchange Information Technology Index is losing 3.91%. This is not surprising, given that growth companies are the most vulnerable during periods of high interest rates. In addition, in winter and spring, shares of Russian IT companies significantly outperformed the entire market, thereby creating a good reserve for subsequent declines against the background of profit taking. Even today - i.e. after a significant decline - the Moscow Exchange Information Technology Index has added almost 26% since the beginning of the year. On August 8, MKPAO VK reported under IFRS for the second quarter and first half of 2024. The company shows good revenue dynamics, but weak profitability, which is associated with investments in development. EBITDA remains negative, but VK may become a beneficiary of the slowdown - and, possibly, the subsequent blocking - of YouTube, added Konstantin Tserazov. Also on August 8, the Yandex Board of Directors recommended that shareholders approve dividends for the first half of 2024 in the amount of 80 rubles per ordinary share. The dividend yield of the securities as of Friday's close was 2.08%. On August 14, the Moscow Exchange will stop trading HeadHunter receipts: the company is in the process of reorganization and redomiciliation to Russia. Trading in shares of MKPAO Headhunter on the Moscow Exchange may begin at the end of September, Konstantin Vladimirovich Tserazov sums up the week.