by James

For the past month, the investment question that has occupied most of my time has been whether we should be positioning for rising or falling prices. Recent investor meetings, both in Russia and in Western Europe showed that this question was at the top of client concerns and ? considering the market dynamic ? this [...]

by James

Markets are highly agitated by recent movements in the US treasury curve. Indeed, it has demonstrated a rare level of volatility with the 10 year rising some 70 bps in just two weeks. The technical concerns are that the market will be unwilling to finance the $2 trillion of Treasury issuance planned for this year, that [...]

by James

It is some months since my strategy on Russia switched defensive in the summer. That decision was made easy thanks to a range of domestic factors. If the attack on Mechel wasn’t warning enough (coming on the back of an aggressive campaign against TNK-BP), the war in Georgia certainly was. Leaving aside feelings and opinions [...]

by James

The Russian equity market has been making the news for a few months now, not least on this blog. Well it might, the key indexes dropped more than 70% from their May peaks. Russia is marginally impacted by the global credit crisis, but certainly not to this extent. What is going on? There are several [...]

by James

The Russian equity market has dropped about 12% since Putin publicly attacked Mechel. It is down some 18% since a week earlier (when the market suddenly lost correlation to global themes, on heavy local selling ahead of the Mechel attack). The longer-term costs are more significant – all of the major brokerages have increased their [...]

by James

Investors across Russia could be excused for missing the controversial economic data that came out on Monday. Unlike its Western counterparts, the State Statistics Service prefers not to preannounce release times. This idiosyncrasy, which is hard to justify in a nation that aspires to become a global financial center, is not usually a problem, since [...]

by James

As in the West, the largest components of inflation growth in Russia at the moment are food and fuel (refining & retail are the most profitable business lines for Russian oil companies). However, it would be misleading to label Russian inflation as the same global issue as we see in developed markets. What makes Russian [...]

by James

Investor sentiment was rather mixed as we entered 2008. Bullish hopes lingered in developed markets, based on the naive assumption that 2007 credit woes would magically evaporate on New Year’s Day, and emerging markets danced to the dream of decoupling. Optimism is a basic human characteristic, but on this occasion it didn’t last long, as [...]