Russia's Stock Market Slumps Amid Sanctions and Weak Investor Demand

Russia’s stock market has slumped since President Vladimir Putin in May 2024 set a goal of doubling its capitalization to 66% of GDP by 2030 — a target that now looks increasingly out of reach as market value has fallen sharply amid war‑related sanctions and weak investor demand. At the end of last year, the total value of companies listed on Russian exchanges stood at roughly 50 trillion rubles ($650 billion), or about 23% of GDP, according to calculations by ratings agency Expert RA. That marks a drop of nearly one‑third from earlier in 2024, and roughly half the level seen before Moscow’s full‑scale invasion of Ukraine in 2022, when market value was estimated at 62.8 trillion rubles ($816 billion), equivalent to 47% of GDP. To hit the 66% target now would require a near‑threefold increase in market capitalization compared with current levels — a steep climb given the obstacles facing Russia’s equity markets. In principle, capitalization could rise through higher share prices, new equity issues or the listing of additional companies. But none of these avenues is gaining traction under current conditions. The exodus of foreign investors after the start of the Ukraine war and reciprocal sanctions — including Russia’s blocking of assets belonging to foreign holders on so‑called “C” accounts — has deprived the market of external financing and left it dependent on domestic capital, Expert RA said.