Russian Equities Retreat on Consumer Stocks Drop, Japan Delay

Russian (INDEXCF) equities dropped as consumer-services shares fell and the Bank of Japan signaled a delay in the start of a stimulus program aimed at reviving the economy.

The Micex Index retreated 0.3 percent to 1,532.64 by 10:36 a.m. in Moscow. Of the 50 stocks in the gauge, 13 advanced and 37 retreated. The amount of shares traded on the Micex was 48 percent below the 10-day average, data compiled by Bloomberg show. The RTS Index (RTSI$), Russia’s dollar-denominated equity gauge, lost 0.2 percent to 1,597.03.

OAO Magnit, Russia’s biggest food retailer by market value, dropped 1.3 percent as consumer services shares led the declines on the Micex, falling 0.9 percent on average. The Bank of Japan will wait until January 2014 to introduce open-ended asset purchases designed to kick start the economy.

Crude oil traded near a four-month high, rising 0.2 percent to $95.70 in New York. Russia receives about half of its budget revenue from oil and natural gas. The Micex’s 10-day volatility rose to 11.22, according to data compiled by Bloomberg.

OAO Pharmstandard, Russia’s largest drugmaker, was the biggest gainer, increasing 1.5 percent.

The Micex trades at about 5.7 times estimated earnings and has added 4.2 percent this year. That compares with a multiple of 10.9 times for the MSCI Emerging Markets Index, which has gained 2.4 percent this year.

Russian equities have the lowest valuations based on estimated earnings among 21 emerging markets tracked by Bloomberg.

To contact the reporter on this story: Ksenia Galouchko in Moscow at kgalouchko1@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net