The first quarter of 2000 brought good investing possibilities to stock mark participants. On 27 March, the MICEX Summary stock index (SSI) reached its historical record value of 227.82 points, having increased by 50% against the beginning of the year. Over three months, the daily average trading turnover grew by 57% and amounted to 2.18 billion rubles, which means that market participants' activity increased considerably against 1999.

March was marked by the end of the period of rapid growth of the Russian stock market, which had lasted from October 1998, when SSI began its growth from the level of 18.53 points. Nevertheless, market participants' activity continued to increase. On 22 September, the maximum daily trading turnover, 4.22 billion rubles, was registered, while the number of participants in trading reached 269. In September, the daily average trading turnover grew to 2.58 billion rubles and remained at that level till the end of the year, having decreased only by 1%

The decline of the market, which started in April, was interrupted only by September correction, when SSI grew from 190 points to 245.37 points. However, the overall decline of world financial markets was the reason why SSI dropped by 4.93% over the year. Among leading Russian trading floors, the MICEX's share in the secondary market continued to grow and amounted to 84.3% in December.

No considerable changes took place in the structure of the turnover of the MICEX market. The share of the Moscow floor in the total turnover of the MICEX decreased by 3.3% (to 85.5% in December) as a result of the growth of the secondary turnover of regional floors. The most attractive financial instrument was the common stock of RAO UES, the average share of which in the turnover amounted to about 85%.

The development of the corporate bonds market
The year of 2000 was marked by the rapid development of the corporate bonds market. The MICEX's efforts to organize the placement of bond loans of companies-issuers are aimed at implementing the national program of attracting investments in the manufacturing sector.

In 1999-2000, corporate bonds to the total amount of over 40 billion rubles at par (in 2000 — over 25 billion rubles) were placed in the MICEX Stock Market Section. In 2000, the market of corporate bonds demonstrated both quantitative and qualitative growth. Thus, the bonds of such companies as MMK, TNK, MGTS, Rostovenergo, Mikhailovski GOK and some other companies were placed on the MICEX, while the total number of issuers reached 25.

An important stage in the development of this segment of the securities market was the beginning of placement of banks' bonds. In 2000, the placement of bonds of a number of large Russian banks and financial companies took place on the MICEX, including the bonds of Vneshtorgbank, Guta-bank, Vredit Swiss First Boston Capital and some other banks.

Listing as a mechanism of control over the quality of companies-issuers' corporate management
One of the most important factors determining the quality of traded securities and the interest of investors in these assets is the level of corporate management of companies-issuers. Through its listing procedure the MICEX controls such important aspects of issuers' corporate management as transparency and insider trading.

In 2000, the MICEX Listing Department:

• further developed the practice of concluding agreements between the MICEX and companies-issuers whose securitiesе are listed on the MICEX. The number of agreements with companies-issuers was increased, while agreements themselves were unified considering the sectoral character of companies-issuers. The aim was to improve the parameters of information provided by issuers and reduce the time of its provision;
• prepared expert opinions and information and analytical materials on all companies- issuers which had applied for listing. The Department also worked on maintaining the listing of securities;
• disclosed information about companies-issuers. The Listing Department collected information from companies-issuers (quarterly and other reports as well as information about significant facts and events) and prepared its own information and analytical materials.

The information generated and accumulated by the Listing Department was open and was provided to the members of the Stock Market Section via different channels, including the Internet.

Control over issuers' timely performance of information disclosure obligations under agreements with the MICEX

Implementation of projects aimed at improving the quality of corporate management of Russian issuers and the prevention of insider trading.

• Jointly with TASIS, the MICEX prepared recommendations to companies-issuers for creating internal Rules of using internal information and worked out model Rules. This document establishes control over the dissemination of internal information inside the company, aimed at preventing the misuse of insider information, and determines the procedure and the time of disclosure of such information by the issuer. Such Rules are obligatory for most Western companies.

Experience has proved that the stringent requirement that companies-issuers adopt such Rules enables to considerably reduce insider trading in securities and increase the transparency of issuers and the quality of disclosed information.

Jointly with "Stanadard&Poors" rating company and the Federal Securities Commission, the MICEX implemented the project to develop the system of rating of the quality of Russian companies-issuers' corporate management. As a result, the Methodology of evaluation of the quality of corporate management was developed and a number of expert studies of Russian issuers were conducted. The MICEX expects the project to produce definite formalized standards of management of Russian companies. The MICEX intends to have the criteria of the quality of corporate management to be integrated in its normative basе as requirements to issuers of securities which must be observed for listing purposes. These criteria can also be used when elaborating the Code of corporate conduct.

"High Technologies" Sector
In April 2000, the MICEX launched the project to create a specialized sector of trading in the stocks of high technology companies within the Stock Market Section. The creation of the "High Technologies" Sector must enable to perform the following tasks:

• attracting investments in projects connected with the development of high technologies in Russia;
• attracting investments in the Sector's companies through organizing IPOs in the "High Technologies" Sector;
• determining the market price of high-tech projects;
• determining the cost of different hi-tech projects (and its dynamics) and the profitability of investments made in these projects. This can be achieved by creating a well-developed and liquid secondary market of stocks of high-tech companies.
• creating an attractive and highly liquid investment medium;
• creating a well-developed and highly liquid organized market of stocks of high-tech companies, which will enable investors to enter this very promising market and, if necessary, to leave it;
• protecting the rights and interests of investors.

The terms of admission and maintaining securities in the Sector include rigid requirements to secure transparency, observe of the norms of corporate management and prevent the leakage of insider information.

In 2000, the MICEX continued to implement INVAS (TASIS) project.