High oil, China demand. The equity-market outlook continues to be very favorable. Oil is trading significantly above the level assumed in the budget, investors are rebuilding Russia exposure, Chinese demand is boosting metals & mineral prices, and assets are inexpensive. Our year-end RTS target gives 28% upside, and the market is on course to regain its record May 2008 high (60% upside) by mid-2011.

When to switch drivers. The best-performing themes in 2010 thus far have been those exposed to Chinese commodity demand and industries involved in restructuring. Oil & gas has lagged badly, as have many domestic themes. The issue for investors is when to switch from global to domestic themes (certainly by the middle of this year on current evidence).

This is the lead to the April 16th Equity Strategy report from Uralsib Bank. The full report is available at http://www.uralsibcap.ru/analytics/strategy.do