Russian shares tumbled to the lowest since November, heading for their fourth weekly decline as crude oil, the country’s main export, fell for a second day.
The Micex Index (INDEXCF) retreated 0.8 percent to 1,390.40 by 10:23 a.m. in Moscow, the lowest intraday level since Nov. 30 and an 11 percent drop from this year’s high on Jan. 28. The index is poised for a 1.9 percent slide in the week. Trading volumes were 30 percent below the 30-day average, while 10-day price swings rose to 12.68, the most since March 28.
Crude oil, which together with natural gas accounts for about half Russia’s budget revenue, retreated 0.3 percent to $93.20 per barrel in New York. OAO Mechel (MTLR), a coking coal and steel producer, fell 1.7 percent to 137.40 rubles. Metal producers OAO Magnitogorsk Iron & Steel, OAO Severstal and OAO Novolipetsk Steel slid at least 0.7 percent. The dollar- denominated RTS Index (RTSI$) sank 1.2 percent to 1,416.11.
The relative strength index on the Micex was at 29. A value below 30 signals the index has been oversold and may reverse losses.
OAO RusHydro declined 1.3 percent to 50.58 kopeks, after falling to the lowest since January 2009 yesterday. The depositary receipts closed down 4.1 percent to $1.62 in New York, a record low since its listing in September 2010.
The personnel committee of the nation’s biggest renewable energy producer yesterday recommended that the board of directors nominate Vladimir Pekhtin to the management board, according to a Rushydro statement. Pekhtin resigned from Russia’s lower house of parliament in February a week after bloggers published documents showing he owned luxury property in Florida.
The RTS Volatility Index, which measures expected swings in stock futures, jumped 1.3 percent to 21.30. The Market Vectors Russia ETF, the largest dedicated Russian exchange-traded fund, lost 1.2 percent to $27.30 yesterday. The Bloomberg Russia-US Equity Index (RUS14BN) decreased 1.2 percent to 95.33 in New York.
Russian equities have the cheapest valuations among 21 emerging markets tracked by Bloomberg. The Micex trades at 5.2 times estimated earnings and has lost 5.7 percent this year, compared with 10.4 times for the MSCI Emerging Markets (MXEF) Index, which has slid 2.5 percent this year.
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