Russia Micex Index Declines Most in Week as Sberbank Drops
Russia (INDEXCF)’s benchmark stock index retreated from a two-week high as OAO Sberbank, the nation’s largest lender, declined and trading volumes fell.
The Micex Index dropped 0.2 percent to 1,501.76 by the close in Moscow. Of 50 stocks, 18 increased and 32 decreased. The dollar-denominated RTS Index (RTSI$) added 0.2 percent to 1,542.55. Financial shares led the declines, as Sberbank, which has the biggest weighting on the index at 15 percent, fell 0.8 percent, the most since March 1, and OAO Bank Vozrozhdenie declined 2.3 percent.
The Micex increased 0.9 percent yesterday to the strongest level since Feb. 20. Today, 10-day price swings on the measure fell to 11.061, while the number of shares traded was 60 percent below its 10-day average, data compiled by Bloomberg show.
“The market is reversing yesterday’s gain, short-term speculators are taking profits,” Alexander Ivanischev, head of research at Infina Investment Co. in Moscow, said by phone.
Preferred shares of OAO Surgutneftegas fell 1.1 percent, while OAO Mechel (MTLR), a coking coal producer, slid 0.8 percent. OAO GMK Norilsk Nickel metal producer dropped 1.2 percent.
The Moscow Exchange will start moving to a two-day transaction settlement system on March 25 for Russian government OFZ bonds and the most liquid equities, the bourse said yesterday in an e-mailed statement.
Russia will raise about 427 billion rubles ($13.9 billion) from offerings of state assets this year, Finance Minister Anton Siluanov said today in Moscow. The sales will resume in the second half of the year, Siluanov said.
Companies earmarked for privatization this year include lender VTB Group, shipper OAO Sovcomflot, the OAO Alrosa diamond miner and OAO Russian Railways.
The Finance Ministry proposed allowing pension funds to invest in initial public offerings, according to a document on Finance Ministry website today. President Vladimir Putin in January proposed lifting IPO investment limits for Russian investors, including pension funds.
Alrosa dropped 0.4 percent to 32.755 rubles, the lowest level since Feb. 28.
The Micex trades at about 5.6 times estimated earnings and has added 1.8 percent this year. That compares with a multiple of 11 times for the MSCI Emerging Markets Index, which increased 0.4 percent over the same period.
The Market Vectors Russia ETF (RSX), the largest dedicated Russian exchange-traded fund, declined 0.7 percent to $29.27 yesterday. The RTS Volatility Index, which measures expected swings in the index futures, retreated 1.7 percent to 20.97.
Oil in New York added 1.2 percent to $93.14 as the euro weakened against the dollar. Oil and natural gas account for about 50 percent of Russia’s budget revenue. Standard & Poor’s GSCI Index of raw materials climbed 0.6 percent to 652.35. The Micex added 0.9 percent yesterday.
The Bloomberg Russia-US Equity Index (RUS14BN) of the 14 most-traded Russian stocks in the U.S. lost 0.6 percent yesterday. The five companies on the Russia gauge that have reported 2012 earnings, including OAO Lukoil, CTC Media Inc. and Yandex NV (YNDX), posted profit that was on average 4.7 percent higher than analysts estimated, according to data compiled by Bloomberg.
“Russian companies’ earnings have been a positive surprise so far,” Infina’s Ivanischev said. “They could help drive the market up.”
Yandex founders Arkady Volozh and Ilya Segalovich and shareholders including Baring Vostok Capital Partners plan to sell about $607 million worth of stock in Russia’s largest Web- search engine, according to a regulatory filing.
They’re offering investors 24.3 million shares, including 18.2 million from Baring Vostok and 5.1 million from Chief Executive Officer Volozh, the statement said. Chief Technology Officer Segalovich is selling 0.2 million shares. Combined, the sale is 7.4 percent of the company.
The shares tumbled 7.3 percent to $23.205 in New York by 11 a.m. The amount of shares traded was 1.6 million, equivalent to about 74 percent of the three-month average.
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