Stock market remains in suspense over forthcoming sanctions
The Moscow Exchange Index (MOEX) is currently trading around 2750–2786 points, showing modest recent gains of about 0.3–0.7% per day and a monthly climb of roughly 1.1%, though it remains about 1.7% below its level from a year ago.
Analysts have a cautious outlook for the MOEX, with forecasts predicting a moderate decline by the end of Q3 2025 and further into 2026. This expectation is largely due to geopolitical risks, particularly the potential for U.S. sanctions on Russia if no agreement is reached on the situation in Ukraine by the first week of August.
Donald Trump recently stated that he will impose sanctions, tariffs, or something else on Russia if no agreement is reached. This statement comes after talks with China, where the Chinese side rejected U.S. demands to abandon Russian oil. The American leader also stated that the new restrictions may or may not significantly harm Russia's main export item, oil.
Key Russian blue-chip stocks contributing to the MOEX's performance include Sberbank, Rosneft, Transneft, and Surgutneftegaz, all showing small positive price movements around early August. These firms are significant dividend payers, and their upcoming dividend distributions are likely providing some short-term support to the MOEX index.
However, the market will not be pulled down by the record dates for shareholders' rights to receive annual payments, as the dividend season is over. Some of these dividends will be used for new stock purchases, primarily heavyweight Sberbank and Transneft.
The current geopolitical risks are not the only factors affecting the market. The publication of II quarter reports for individual stocks, preliminary assessments of Russia's GDP for II quarter 2025, and July inflation dynamics may also impact the entire market. Many investors are reluctant to buy down stocks due to the vacation season, preferring to relax rather than shake up their mid-term portfolios.
Despite the cautious outlook, there is some resilience in the MOEX, with small daily gains supported in part by dividends from large energy and financial companies like Sberbank, Rosneft, Transneft, and Surgutneftegaz. Nevertheless, the further dynamics of the market will depend on the severity of the announced measures and their negative impact.
Nataliya Milchakova from Freedom Finance Global has mentioned these factors as potential market movers. While there is no unified opinion among analysts on the direction of the stock market in early August, speculators may start buying stocks in anticipation of Donald Trump's verdict. They do not expect either a strong rise or a significant decline at the moment.
It is important to note that the MOEX decreased by 4% by the end of July, with around 3% of the decrease due to dividend gaps that have started to close gradually. Historically, the stock market has closed the last month of summer with a decline only once in the past 10 years (in 2024), and the peak drop in the MOEX was twice as large.
In conclusion, the MOEX in early August 2025 is facing a moderate decline amid geopolitical tensions and potential U.S. sanctions. However, there is some resilience in the index, with small daily gains supported by dividends from large energy and financial companies. The further dynamics of the market will depend on the severity of the announced measures and their negative impact.
Investors should be cautious in their investing strategies, as the Moscow Exchange Index (MOEX) is expected to have a moderate decline by the end of Q3 2025 and further into 2026 due to geopolitical risks, particularly the potential for U.S. sanctions on Russia. The resilience in the MOEX is partially attributed to the dividends from large energy and financial companies like Sberbank, Rosneft, Transneft, and Surgutneftegaz.
Speculators may start buying stocks in anticipation of Donald Trump's verdict, as there is no unified opinion among analysts on the direction of the stock market in early August. Nevertheless, the future direction of the MOEX depends significantly on the severity of the announced measures and their negative impact.
