Where next for investors in Russia after geopolitical tensions reach breaking point?

Washington-Moscow relations fraught

The sell-off in Russian markets following the US's shock decision to impose harsher sanctions has created a divergence between emerging market debt and equity managers, with bond managers becoming extremely bearish while equity managers have identified buying opportunities.

On 6 April, the US hardened sanctions imposed on Russia by targeting seven of the country's richest men, as well as 17 government officials. The move followed what Western powers view as aggressive...