> The US budget is a problem, but other factors look better. The global market context will again be tightly focused on Washington and the negotiations to resolve the budget talks before the year-end deadline. Late last week, both sides warned not to expect a quick resolution with President Barack Obama referring to "prolonged negotiations" ahead and Speaker of the House John Boehner saying "Right now we're almost nowhere" on talks. Thus, the issue will very likely hang over markets until 2012 closes. However, that does not preclude further advances in equities in the meantime, as US and Chinese economic reports show improving conditions and the near-term threat of an escalation in the Eurozone crisis seems to have passed. Today's manufacturing surveys in major economies will set the tone for the start of the week, while the US payroll report will determine the mood as this week ends.

Passing the risk baton between several policymakers. While Fed Chairman Ben Bernanke's words encouraged investors and can sustain modest net optimism as the new week starts, they really only serve to pass the risk baton on to the next runner in the relay race: the ECB. Investors will now focus on Thursday's ECB policy meeting to see what, if anything, the bank proposes with regard to bond purchases. But, as with Bernanke's comments, no matter what ECB President Mario Draghi says this week, the race to cut risk and stabilize markets is far from over. The ECB will pass the baton on to the German court to rule on the legality of the ESM on Wednesday next week, a day before the Fed announces the decision from its monthly two-day FOMC meeting. Even then, the race is unlikely to end. The baton will very likely be passed on to the EU Council meeting in mid-October, when the region's political leaders will decide on easing Greece's bailout terms and paying the next tranche of money, and on how to support the ECB's bond plans.

This is the first of a new series of strategy reviews that will focus on "game-changing" events in Russia. Titled "Russia: The Director's Cut", the reviews will take a deep view of the subject and advise investors on how best to benefit from the changes expected.

Russia started negotiating WTO membership on June 16, 1993, when the Working Party on accession of the Russian Federation to the WTO was established. On August 23, over 19 years later, Russia will formally be admitted as a member to the trade organization. No instant solutions. It has become something of a cliche by now to state that accession to the WTO is not a magic wand - it will not instantly improve Russia's business climate or immediately change how investment skeptics view country risk. It is nevertheless a game changer that has significant medium to longer-term investment implications.

Next steps in Greece will be crucial. The outcome of the Greek election and optimism that the US Federal Reserve, along with other major Central Banks, may be close to adding fresh growth stimulus will provide the backdrop to global markets this week. Asia's markets and commodities have started the week with an extension of last week's gains, as investors greet with relief the news that Greek voters have opted to stick with the austerity measures and the euro, at least for now. That same combination led to gains across most equity markets last week, as investment fund managers latched onto any reason to try to recover some of the very poor fund performances recorded so far in this quarter.

After five straight weeks of redemptions, emerging market funds saw an inflow of $920 mln in the week to Wednesday. This compares with an outflow of $1.3 bln the week before and follows a loss of $5.9 bln through May. But while assuming a more positive outlook on the EM asset class, investors remain cautious about Russia and last week took another $33 mln from retail funds focused on the country. This extends the uninterrupted run of net redemptions to eight straight weeks, albeit the outflows in that period remain relatively small versus the net investments made through 1Q12.

The Russian market is about to be hit by chunky inflows of cash from dividends and buybacks, $31 bln having been pledged as dividends by Russian corporates for 2011. A regulation implemented at end 2010 requires that dividends be paid to investors within 60 days of their approval at the AGM, which means dividends will be disbursed by summer's end. Adjusted for free float, $31 bln in total translates into a $9.8 bln disbursement to portfolio investors in Russian stocks. In addition, Russian companies have announced another $11 bln in buyback programs. While the timeline of the dividend injection is no wider than the next three months, it will be an important supportive factor throughout the year, as cash disbursed to minority shareholders will be put to work in other Russian stocks. On our estimates, the total inflow from buybacks and dividends this year will be $21 bln - which, disbursed to minority shareholders, will provide a solid support for markets.