First month of trading: in which sectors of the Moscow Exchange investors earned and lost and why

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

Sber BankSBER123.85 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

AeroflotAFLT30.80 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

GazpromGAZP237.53 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

PhosAgroPHOR7110.00 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

RusHydroHYDR0,80 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

MTSMTSS205.00 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

Norilsk NickelGMKN21 000,00 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

MagnetMGNT4566,50 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

YandexYNDX1721.00 RKbuy

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

PIKPIKK549.60 RKbuyService in partnership with Tinkoff Investments. Quotes are updated every 15 minutes

24 March 2022, trading in shares resumed on the Moscow Exchange after a month-long break - the longest pause in the recent history of the Russian stock market. In the first two days of trading, shares were available to investors 33 the most liquid issuers from the Moscow Exchange index, but already 28 March, the Central Bank allowed all Russian shares to be traded. From the same day, the calculation of sectoral indices was resumed.

In general, the Moscow Exchange index in the first week of trading, with 24 March to 1 April, showed growth. At specific moments, it exceeded 2800 points. And then there was a correction., And 25 April index closed below 2200 points. Already in the next two days, the index returned to growth and 27 April reached the level of 2424 points. As a result, since the opening of the exchange, iMOEX has shown near-zero dynamics and fell by 1,9%.

But broken down by sector, the results were very mixed.. I suggest we consider, which Russian sectoral indices in the first month of full-fledged trading - from 28 March to 27 April — felt better than the market, and which ones were on the list of outsiders and why.

Первый месяц торгов: в каких секторах Мосбиржи инвесторы зарабатывали и теряли и почему

Finance (−5%)

Financial Sector Index (MOEXFN) was among the leaders of the fall. Many large systemically important banks in Russia fell under the influence of tough Western sanctions. The restrictions mainly affected banks with state participation., as well as those, who participated in the financing of military orders or served enterprises significant for the state.

But one way or another, almost all players in the sector felt the negative consequences of the aggravation of geopolitical confrontation. In particular, in the stock section of the Moscow Exchange, trading volumes have significantly decreased after the resumption of trading, which negatively affects the commission income of the platform.

In 2021, Russian banks increased their net profit by almost 50%, therefore, many investors entered securities with the expectation of record dividends for the reporting period. But it's already obvious, that many financial institutions will cancel or postpone payments until “better times”.

The Central Bank of Russia even officially recommended that all commercial banks refuse dividends "due to the difficult economic situation". Very likely, that many banks will suffer losses as a result of 1 semester 2022, as they will be forced to increase their financial reserves amid increased risks.

Yield from 28 March to 27 April

Sberbank (SBER) −0,3%
VTB (VTBR) +13,5%
Moscow Exchange (MOEX) −3,4%
ICD (CBOM) +1,5%
TCS Group (TCSG) −19,7%

−0,3%

Transport (+13,5%)

It would seem that, transport sector (MOEXTN) is another industry, which should be hit hard by Western sanctions, because restrictions negatively affect the volume of trade between Russia and other countries. But the sectoral index turned out to be in a noticeable plus at the end of the month. Large port holdings NCSP and FESCO are among the growth leaders.

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Maybe, the reason is, that the sanctions, imposed on the sector, were softer than investors' expectations: complete isolation of the country did not happen, Furthermore, Russia continues active international trade, among other things, also with the EU countries and the USA.

Separately, I would like to highlight the Aeroflot Group, on whose international business the sanctions dealt another powerful blow, But the company has not yet managed to recover from the consequences of anti-COVID restrictions. It is international flights that are the most profitable for business and, until 2020, brought the largest income.. Therefore, even the growth of domestic air transportation is unlikely to be able to compensate for monetary losses.. It is no coincidence that the government is discussing the next additional issue of the issuer., which will dilute the shares of current shareholders.

Yield from 28 March to 27 April

Globaltrans (GLTR) +3,6%
FESCO (FESH) +73,0%
Aeroflot (AFLT) +25,8%
Sovcomflot (FLOT) −0,5%
NMTP (NMTP) +36,2%

+3,6%

Oil & Gas (−6%)

The fall of the oil and gas sector (MOEXOG), probably, among other things, associated with the expectation of the sixth package of sanctions from the European Union, which may include restrictions on the purchase of oil from Russia. The fact, that the EU is the largest consumer of Russian oil, to countries, members of this union, accounts for about half of all crude oil sales from Russia, which means, partial or complete embargo could cause significant damage to domestic oil companies.

Besides, our country is the largest supplier of natural gas to Europe. With 1 April Russia transferred payment for Russian pipeline gas to rubles for "unfriendly countries", including EU countries, which increases the risk of breaking existing long-term gas contracts with some countries. In particular, already aware of the suspension of Russian gas supplies to Poland and Bulgaria.

The general negative information background puts pressure on the quotes of companies in the oil and gas sector, but it is worth noting, that prices for hydrocarbons in the world market are close to historical highs. This allows Russian companies to make good money on exports., even despite the discount on the sale of Russian raw materials, as well as reduced supply.

Yield from 28 March to 27 April

Gazprom (GAZP) +5,4%
Rosneft (GROW) +12,1%
Lukoil (LKOH) −12,5%
Novatek (NVTK) −22,6%
"Tatneft" (TATN) −11,1%

+5,4%

Chemistry and petrochemistry (+0,1%)

Chemical and petrochemical sector index (MOEXCH) at the end of April is approximately at the same levels, from which he started after the resumption of trading in the stock section of the Moscow Exchange. In part, this reflects the dynamics of the shares of the fertilizer producer PhosAgro., whose weight in the index is 61,7%.

It is worth noting, that Russian producers can make good money this year on the growth of world prices for fertilizers against the backdrop of a real risk of a food crisis in the world. This is indirectly confirmed by the fact, that Russian fertilizer producers were removed from the action of US sanctions, to ensure the food security of the country and the normal operation of the agricultural industry.

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However, Western sanctions will have a long-term negative impact on the sector, among other things, and by limiting the import of Western equipment and technologies for chemical, petrochemical and oil refineries. This will complicate and slow down the development of investment projects important for the Russian economy.

Yield from 28 March to 27 April

Phosagro (PHOR) +0,5%
Akron (AKRN) +9,5%
«Kuibyshevazot» (KAZT) +30,0%
Kazanorgsintez (KZOS) −3,7%
Nizhnekamskneftekhim (NKNC) +2,6%

+0,5%

Electricity (+5%)

Energy sector (MOEXEU) can be considered protective, since it works mainly for domestic consumers, and therefore the income of issuers from this sector is less dependent on the world market conditions.

But the financial results of energy companies are directly dependent on electricity tariffs, which are set by the state taking into account the forecast inflation. Probably, the state will strive to, to contain inflation, among other things, and through limiting the growth of electricity tariffs for consumers. So,, the level of tariff indexation in the current year may not be sufficient to, to compensate for the real costs of the business, taking into account the rise in prices for raw materials, services and salaries.

Yield from 28 March to 27 April

RusHydro (HYDR) +15,8%
FSK UES (FEES) +2,3%
Inter RAO UES (IRAO) +9,5%
Unipro (UPRO) −3,6%
"Rosseti" (RSTI) +0,8%

+15,8%

Telecommunications (+3%)

The situation is similar in the telecommunications sector. (MOEXTL), which also focuses on the domestic market and is highly dependent on the tariff policy. Companies in this sector can count on a stable and regular cash flow from customers as a payment for the provision of communication services., Internet, pay TV and more, which is especially important in times of crisis.

But the likely decline in real disposable incomes of the population and high inflation will negatively affect the margins of businesses in this sector in the medium term. Besides, it will now be more difficult for companies to access foreign technologies and equipment due to Western sanctions.

I will note, that the quotes of only two companies have the greatest influence on the dynamics of the index: MTS and Rostelecom. Their weight in the index is almost 99%.

Yield from 28 March to 27 April

MTS (MTSS) +8,9%
Rostelecom (RTKM) −8,4%
Rostelecom, Privileged (RTKMP) +1,1%
«MGTS», Privileged (MGTSP) −7,3%

+8,9%

Metals and mining (−2%)

Situation in the metals and mining sector (MOEXMM) looks extremely ambiguous. On the one side, Western sanctions limit Russian companies' access to US markets, EU and their allies. This may lead to a decrease in sales volumes in the current year and the share of sales of high value-added products., even if it is possible to quickly reorient to alternative sales markets.

On the other hand, prices for mining and metallurgical products are at high levels amid strong pro-inflationary expectations. This can allow a business from Russia to make good money even despite a drop in natural sales., especially in view of that, that many domestic companies have a vertically integrated business structure and largely provide their own enterprises with raw materials.

Yield from 28 March to 27 April

Norilsk Nickel (GMKN) +1,0%
"Pole" (PLZL) +7,6%
Alrosa (ALRS) −8,1%
Severstal (CHMF) −6,8%
NLMK (NLMK) −8,8%
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+1,0%

Consumer sector (+8%)

Consumer sector (MOEXCN) strongly depends on the situation in the domestic market and effective consumer demand, since it is mainly represented by retail chains and food producers.

In general, this segment outperformed the market last month, despite the general deterioration of the economic situation in Russia. Probably, investors are counting, that companies in the sector will at least partially “protect” capital from inflation, because they can raise the price of their products, taking into account the increase in the cost of sales.

Besides, the expectation of further price increases encourages buyers to spend more, until savings are worthless. This is evidenced by the data of Rosstat, which reported an increase in retail turnover in March by 2,2% to the same period last year.

Yield from 28 March to 27 April

"Magnet" (MGNT) +38,2%
"Child's world" (DSKY) +3,5%
X5 Retail Group (FIVE) −6,7%
Fix Price Group (FIXP) +23,4%
Rusagro (AGRO) −7,1%

+38,2%

Information Technologies (−5,5%)

In the dynamics of the information technology index (MOEXIT) last month saw high volatility. To a large extent, this is due not so much to the operating and financial results of companies, how much with the growth of infrastructure risks. The fact, that many companies in this sector are registered abroad and have the status of a foreign issuer, and shares are not traded on the Moscow Exchange, and depositary receipts of issuers.

Many investors have already faced difficulties due to holding securities of foreign issuers in the accounts of those brokers., that fell under the sanctions. Besides, there is a risk that, that in the future domestic investors will be limited in their ability to freely buy and sell depository receipts. Against this background, the sector was among the outsiders in the last month.

Yield from 28 March to 27 April

«Yandex» (YNDX) −13,0%
HeadHunter (HHRU) +5,2%
QIWI (QIWI) −19,4%
CIAN (CIAN) −13,7%
VK (VKCO) +44,5

−13,0%

Construction sector (+14,5%)

But the construction sector (MOEXRE) unexpectedly broke into the leaders in terms of profitability at the end of the past month. And this despite the fact, that at the end of February the Bank of Russia raised its key rate to 20%. This led to an increase in the rate and limits on preferential mortgages and forced commercial banks to revise the mortgage lending rate upwards against the backdrop of the collapse of the ruble. Nevertheless, in March, developers were able to capitalize on the rush demand: customers wanted to have time to buy apartments at the old prices and before the increase in lending rates.

According to the results of April, it is already possible to state some stabilization in the market and a drop in demand relative to March values: the exchange rate of the Russian currency has almost returned to pre-crisis values, reduced mortgage rates to 9%, and home prices remain close to historic highs. Against this background, developers like LSR and Etalon publish strong operating results based on 1 quarter.

Yield from 28 March to 27 April

PEAK (PIKK) +12,7%
"Airplane" (SMLT) −1,4%
LSR (LSRG) +3,6%
"Reference" (ETLN) +21,4%

+12,7%

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