Go local

The Russian deputy PM Igor Shuvalov has been accused of insider trading, that is profiting from the pending abolition of the two-tier market in Gazprom shares in 2005-6.

Now Shuvalov is strongly suggesting that Russian companies delist from Western stock exchanges – from London and New York above all. Shuvalov’s request applies to depositary receipts (ADRs and GDRs) as well as primary listings, although not to all companies – definitely to those at the risk of US sanctions.

Instead, Shuvalov promises government “assistance” to Russian firms seeking to tap “non-traditional”* capital markets – Singapore, Hong Kong, the Middle East perhaps?

Since lots of investors can only invest in DRs, not in local shares, Shuvalov’s idea sounds rather bearish to me but so far the markets have disagreed. Is it an empty threat then?

*The word is typically used in a different context in Russian: “non-traditional orientation” means homosexuality.

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