Dividends and Russian stocks jump as trade resumes after month-long break

Likely you will have heard or remember 9/11 as it relates to the World Trade Center building in New York. One of the things you may or may not know is for a long time, the buildings at the World Trade Center were relatively inexpensive office space so a number of companies including the New York Stock Exchange had their servers in the building (they also had back up in New Jersey or across the river from New York City). When the tower came down, the Stock Exchange was down but it was up and running 2 days afterwards on a reduce workday. It took about a week to become normal.

In the Russian war against the Ukraine, the western world imposed financial sanctions on Russia and one of the many elements was the Russian Stock Exchange was closed. There are a number of Russian stocks which trade on the London Stock Exchange that have not traded since the sanctions and maybe there are good speculative reasons why you might wish to buy when the sanctions are off.

In an article from Reuters, energy and metal firms led a jump in Russian stocks on the Russia Stock Exchange. According to Boris Blokhin, head of Moscow’s Exchange stock department said they were trying to do everything possible to open all segments of the stock market soon.

When the war started, because of Russia’s supply of oil and metals coming to a halt or slow downs, the commodity price of oil and metals have increased.

The government says its National Wealth Fund would buy up to $13 billion or one trillion rubles to buy stocks or support the market.

The Moscow Exchange said 567,000 private investors had accounted for 58.2% of the volume, with 121 professional participants conducting the remainder.

Linking to dividend paying stocks, every country which has a stock market the government put great faith and resources to ensure the market functions as well as possible. In signs of trouble, governments ensure stock markets are open and trading to reflect the future. From a value perspective when the sanctions are lifted (meaning Russia has lost) the economy will become open again and the large companies will be profitable once again. It may take time, but there may be value in Russian stocks when the London Exchange trades them again.

There are more questions than answers, till the next time – to raising questions.

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