Micex Index Falls First Day in Three on Oil Retreat, Europe Woes
Russian stocks fell after two days of advances as oil, Russia’s biggest export, retreated and rising bad loans in Spain stoked concerns Europe’s debt crisis is worsening.
The Micex Index (INDEXCF) slid 0.3 percent to 1,384.53 by 10:17 a.m. in Moscow, the biggest intraday drop since June 8, after gaining 1 percent yesterday. OAO Novolipetsk Steel, Russian billionaire Vladimir Lisin’s steelmaker, lost 1.4 percent and OAO Severstal, Russia’s second-largest steel producer, slipped 1.2 percent. OAO RusHydro receded as Kommersant reported Rosneftegaz may invest 85 billion rubles ($2.62 billion) for a 25.8 percent stake in Russia’s largest power producer.
Crude fell 0.3 percent in New York, retreating for the second day. Spain’s borrowing costs soaring to a euro-era record after bad loans jumped to the highest proportion of total lending since 1994 in April overshadowed electoral gains pro- bailout parties made in Greek elections over the weekend.
“The Spanish banking sector remains a source of deep market concerns,” Alexei Zabotkin, an analyst at VTB Capital, said in an e-mailed note. “Deeper-rooted problems, which are contributing to the crisis remain unresolved.”
The Russian Depositary Index (RDXUSD) of London-traded stocks added 1 percent to 1,517.27 yesterday. The dollar-denominated RTS Index was little changed at 1,347.30.
The MSCI Emerging Markets Index rose 0.1 percent to 934.81, gaining for the third day. Russian stocks trade at 5.1 times estimated earnings, having lost 1.2 percent this year. That compares with a 2 percent gain for the MSCI Emerging-Market Index (MXEF) which trades at 9.6 times projected earnings.
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