Is Russia Moving Past The Coronavirus Pandemic?

Is it over?

Let’s just hedge with “it’s getting there.” Global coronavirus watchers will like the looks of Russia, but not anymore than they like the looks of Brazil, whose stock market has been on a tear while Russia’s been a dud.

The good news: Russia is watching its nationwide coronavirus cases dwindle as some parts of Europe see a spike. But this country’s investors are hoping that a new home grown vaccine currently in its final testing phase will one day make things even better at some point in January 2021.

Whether Russia pulls that off or not remains to be seen. Still, its testing is one of the most pronounced in the emerging markets and its death total is lower than the other hardest hit countries at just around 16,000.

Russia registered 4,748 cases of Covid-19 infections in 83 regions on Monday. The day before, the total was 4,892 people, with today marking the fourth day for declining numbers. The total number of infected so far was 932,493, according to the Russian Health Ministry.

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Moscow is still the epicenter, with over 690 cases this week.

More than 32.9 million tests have been carried out in Russia at around 184 thousand per day. All told, some 226,000 people remain under medical supervision, with many of them still in intensive care units. 

Around 6,500 people are recovering from complications caused by the virus and 742,628 patients hospitalized with it have been discharged.

Early in the pandemic, some people were critical of Russia’s numbers because the mortality rate was so low compared to European countries at the time. People doubted Russia almost as much as they doubted China. In some EU countries, mortality rates were in the double digits mostly due to a low number of known cases at the time. Those who had it and were the easiest to count were often the sickest.

Russia has weathered this as good as anybody else, with its economy in tatters and concerns of a European-style second breathing down their collective necks. Some restrictions on large gatherings remain.

Russian stocks are up 0.13% on Tuesday in Moscow. Overall, Russia investors holding the VanEck Russia (RSX) ETF, the highest volume trade into Russia, would have been better off just buying the MSCI Emerging Markets Index or pick a big Russian brand — like Yandex YNDX . RSX, thanks to weak oil prices, and a raging pandemic there, is down 6.7% this year. Yandex is up 40%.

RSX has performed in line with the FTSE Europe (VGK) VGK ; both are down just under 7% and both are up 24% for Russian and 23.4% for Russia over the last three months. Yandex is up 57% in the last three months. Tech stocks love the coronavirus.

Lastly, July’s decline in industrial production came in at 8% year-over- year, although the recovery in industrial output was better than June thanks to the demand part of the equation.  Rosstat says that Russia is unlikely to reach pre-pandemic production levels over the next month, meaning the economy is stuck in first gear.

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