Russian stocks climbed for the third day as investors awaited signs on economic stimulus from the U.S. Federal Reserve and Sberbank CIB recommended buying shares in OAO Rostelecom.
The Micex Index (INDEXCF), Russia’s benchmark equities gauge, added 0.7 percent to 1,334.11 by 12:46 p.m. in Moscow. The country’s stocks have the cheapest valuations among 21 emerging markets tracked by Bloomberg.
Rostelecom climbed 3 percent to 98.75 rubles as Sberbank lifted the stock to buy, citing its drop this year in an e-mailed note. The shares have lost 18 percent in Moscow this year. Fed Chairman Ben S. Bernanke holds a press conference tomorrow after a two-day policy meeting.
“The main question is what the Fed will say, before that investors will refrain from making any bold moves,” Vladimir Bragin, head of research at Alfa Capital in Moscow, where he helps manage $2.9 billion, said by phone. “Russia will be closely watching the commodities prices as we remain highly reliant on them.”
The dollar-denominated RTS Index (RTSI$), which entered a bear market on June 5, rose 0.2 percent to 1,316.37. Telecommunications stocks were the biggest gainers among nine industry groups on the Micex, adding 1.8 percent on average.
The 14-day relative strength index on the Micex advanced to 45.9 after falling to 31.4 last week, the closest since April to a level of 30, which signals a rebound to some analysts. On the Micex, 37 stocks increased and 12 dropped. The volume of shares traded on the gauge was 14 percent below the 30-day average, while 10-day price swings rose for a fourth day to 26.38, the highest since June 3.
Bank Rossii held its refinancing rate at 8.25 percent on June 10. That matched the median estimate in a Bloomberg survey of 26 economists, with four predicting a quarter percentage point cut. Inflation in Russia accelerated for a second month in May to the fastest pace in 21 months.
Russia’s economy grew 1.6 percent in the first three months, decelerating for a fifth quarter and missing the medium-term target of 5 percent set by Prime Minister Dmitry Medvedev, the slowest pace since 2009. The Economy Ministry lowered this year’s growth forecast to 2.4 percent from 3.6 percent in April.
OAO Mechel (MTLR)’s preferred shares tumbled as much as 4.2 percent, losing 1.9 percent to 52.70 rubles. The coking coal producer posted an adjusted net loss of $233 million in the first quarter, according to today’s statement.
Crude oil, Russia’s chief export earner, retreated 0.2 percent to $97.54, trading near the highest price in more than four months before a government report that will probably show U.S. stockpiles declined as refinery processing increased. Brent for August settlement decreased 0.2 percent to $105.28 a barrel on the London-based ICE Futures Europe exchange. Urals crude, Russia’s major export blend, dropped 0.4 percent to $104.71.
Out of 50 stocks on the Micex, two closed yesterday at 52-week lows and three at highs, according to data compiled by Bloomberg. Eighteen stocks, or 36 percent, were trading above their 50-day moving average.
The Micex trades at 5 times its 12-month estimated earnings, having lost 9.6 percent this year, compared with a multiple of 9.8 for the MSCI Emerging Markets Index, which is down 9.5 percent.
The Russian Volatility Index slid 1.2 percent to 27.48. The Bloomberg Russia-US Equity Index of the most-traded Russian companies in the U.S. increased 0.7 percent to 86.08 yesterday.
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