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Stocks of Russia’s Companies Called the Cheapest Worldwide
The index of Moscow Interbank Currency Exchange (MICEX) has slumped 73 percent this year, having suffered the heftiest losses amid 48 basic national indexes. The stocks of Russia’s companies are the cheapest worldwide, Bloomberg concluded.
According to Bloomberg statistics, 22 of basic stock indexes have lost a half of their capitalization in 2008. The decline exceeded 60 percent in China, Greece, Ireland, Peru and Austria and the U.S. S&P 500 sank 40 percent. Morocco and Jordan have manifested the healthiest performance with indices losing no more than 6.4 percent and 19.2 percent respectively there.
So far, the stocks of companies from emerging economies are getting cheaper at the rate that is well-above the cheapening pace manifested by the stocks of the companies from developed states. MSCI World 23 fell 8.3 percent in the past week, while MSCI emerging markets lost 17 percent.
The reasons of Russia’s losses have been reported earlier. First, both RTS and MICEX were affected by global financial collapse that forced investors to pull out of the most risky emerging economies. Second, the lack of liquidity in the national banking system prompted financial institutions to sell securities at large. And last but not least, the prices for crude have lowered by over two fold in the recent months, which may impair the profits of Russia’s oil and gas producers.
www.kommersant.com
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