RUSSIA - RTS Stock Exchange (RTS), the Moscow-based stock exchange, and Standard & Poor’s are to develop a “new generation” of Russian equity indices.

Under the agreement, S&P and RTS will work together to develop, calculate, license and promote Russian equity indices worldwide. Financial terms of the deal were not disclosed.

The headline RTS Index, which is the main indicator of the Russian stock market, and all the joint index products are to be promoted under the name S&P/RTS.

Commenting on the deal, Robert Shakotko, global managing director of Standards & Poor’s Index Services, said: “RTS is the natural exchange choice for Standard & Poor’s.” He added: “Our internationally adopted index standards will enhance local liquidity in an environment where competition is high between Russian exchanges and foreign markets for turnover in Russian equities.”

Cynthia Stone, head of Standard & Poor’s in Russia, said: “We believe the Russian equity market offers great potential for investors. This link with RTS reinforces our commitment to Russia.”

The new RTS/S&P indices are expected to launch in the first half of 2005.

The increasing strength of Russian domestic investment, as well as regulation requiring Russian companies to first list domestically and float no more than 40% of their shares abroad, make locally managed Russian indices and domestic trading indispensable for investors wanting to invest in Russia, S&P said in a statement.