Russian financial markets in August 2014

Navigating Market Volatility: A 2014 August Review of Russian Financial Trends

Beau Callahan in Business & Economy August 2025 • 4 min read.

"Decoding MICEX Fluctuations, Corporate Bonds, and Investment Strategies"

The Russian financial markets experienced a dynamic August in 2014, characterized by fluctuations in the MICEX Index and evolving trends in the corporate bond market. After reaching 1,460 points on August 21, the MICEX Index declined by 4.1% to close at 1,400.7 points on August 29. The market capitalization stood at Rb 22.4 trillion, or 34.6% of Russia's GDP.

A significant negative influence was the surge in the weighted average effective yield on corporate bond issues, leading to a downward movement in the corporate bond portfolio duration index and reduced investor activity. Despite these challenges, August also saw positive developments, including increased market volume and issuer activity related to new securities issues. Bond issuers also demonstrated improved fulfillment of their obligations to bondholders.

This analysis delves into the key trends and indicators that shaped the Russian financial markets during this period, providing insights into market behavior, investment strategies, and broader economic factors.

Decoding the Movements of the Russian Stock Market in August 2014

Russian financial markets in August 2014

From August 7 to August 21, the MICEX Index surged by 9.6%, fueled by the absence of new sanctions from the European Union and the United States. This growth underscored the sensitivity of investors to geopolitical factors. However, the announcement of impending sanctions triggered a 4.1% drop in the MICEX Index to 1,400 points during the last ten days of August, highlighting the significant impact of sanctions on market sentiment.

During the first week of August, highly liquid shares on the Moscow Exchange declined in response to new sanctions primarily targeting major Russian banks. However, the market rebounded between August 10 and August 20, recovering to its August 1 level. This recovery continued, with market quotations gaining 5% from the beginning of the month.

Sberbank: Annual yield on ordinary shares fell to -17.0%, while privileged shares saw an even steeper decline of -21.2%.
VTB: Shares also experienced losses, with an annual yield of -15.2%.
Norilsk Nickel: Bucking the trend, shares soared by 65.4% due to price surges earlier in the year.

Notably, the MICEX Innovation Index declined significantly in August, falling by over 15% since the beginning of the month. This drop was primarily driven by the price movement of shares in OJSK Armada (ARMD) following the release of its latest quarterly report. These negative expectations underscored the impact of company-specific news on market indices.

Final Thoughts: Adapting to Russia's Evolving Financial Landscape

The Russian financial markets in August 2014 presented a complex picture of volatility and opportunity. Geopolitical factors, sanctions, and company-specific news all played significant roles in shaping market trends. Understanding these dynamics is crucial for investors and stakeholders navigating Russia's evolving economic landscape.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.2139/ssrn.2500111, Alternate LINK

Title: Financial Markets In August 2014

Journal: SSRN Electronic Journal

Publisher: Elsevier BV

Authors: Nikita Andrievskiy, Elizaveta Khudko

Published: 2014-01-01

Everything You Need To Know

How did the MICEX Index perform in August 2014, and what factors influenced its fluctuations?

In August 2014, the Russian financial markets experienced notable volatility. The MICEX Index, a key indicator, initially surged, reaching 1,460 points by August 21. However, it subsequently declined, closing at 1,400.7 points on August 29, representing a 4.1% drop. This fluctuation was influenced by geopolitical factors such as the anticipation and announcement of sanctions from the European Union and the United States. Market capitalization stood at Rb 22.4 trillion, reflecting 34.6% of Russia's GDP.

What were the key trends and challenges observed in the Russian corporate bond market during August 2014?

The corporate bond market in Russia during August 2014 was characterized by a surge in the weighted average effective yield on corporate bond issues. This increase led to a downward movement in the corporate bond portfolio duration index, signaling reduced investor activity. Despite these challenges, there were positive developments, including increased market volume and issuer activity related to new securities issues. Furthermore, bond issuers showed improved fulfillment of their obligations to bondholders.

How did sanctions from the European Union and the United States impact the MICEX Index during August 2014?

During August 2014, the announcement and anticipation of sanctions from the European Union and the United States significantly impacted the MICEX Index. Initially, the absence of new sanctions fueled a 9.6% surge in the index. However, the announcement of impending sanctions triggered a 4.1% drop in the MICEX Index, highlighting the market's sensitivity to geopolitical events. The sanctions primarily targeted major Russian banks, leading to an initial decline in highly liquid shares on the Moscow Exchange.

What were the individual stock performances of Sberbank, VTB, and Norilsk Nickel on the Moscow Exchange in August 2014?

The performance of specific stocks on the Moscow Exchange varied significantly in August 2014. Sberbank's ordinary shares saw an annual yield decline of -17.0%, while its privileged shares experienced an even steeper drop of -21.2%. VTB shares also faced losses, with an annual yield of -15.2%. In contrast, Norilsk Nickel shares soared by 65.4%, driven by price surges earlier in the year. The MICEX Innovation Index declined by over 15%, primarily due to the price movement of shares in OJSK Armada (ARMD) following its latest quarterly report.

What were the main factors driving volatility and shaping trends in the Russian financial markets during August 2014, and why is understanding these dynamics important?

Several factors shaped the Russian financial markets in August 2014, creating both volatility and opportunities. Geopolitical factors, such as the imposition and anticipation of sanctions from the European Union and the United States, played a significant role. Company-specific news, as seen with OJSK Armada (ARMD), also influenced market trends. These dynamics highlight the importance of understanding the broader economic landscape and geopolitical context for investors and stakeholders navigating Russia's financial markets. Monitoring the MICEX Index and corporate bond market trends remains crucial.