Russian stocks are likely to need more time to reenter the widely followed MSCI global equity indexes than the most optimistic scenario of two years from June, JPMorgan analysts wrote in a client note.
Russia was removed from the MSCI equity indexes, including its emerging markets benchmark (.MSCIEF), in early March 2022, days after Moscow’s invasion of Ukraine began.
In a late Tuesday note, JPMorgan said that while investors hoping for an imminent resolution to the war might be expecting the two-year process for Russia stocks to rejoin the index to start in June, it was “too optimistic” to think that timeline would be met. MSCI can at its discretion alter the process, however.
“We conclude best case MSCI re-entry would be June 2027, but base case we expect it to be years later,” JPMorgan said.
Russia and Ukraine accused each other on Wednesday of violating a deal to temporarily end attacks on energy targets, just hours after it was agreed by U.S. President Donald Trump and Russia’s Vladimir Putin.
Yet Trump said after a call with Ukraine’s President Volodymyr Zelenskiy that “we are very much on track”.
Source: Reuters.com