Russian equities snapped the longest losing streak in three weeks, as OAO Rosneft climbed after Chief Executive Officer Igor Sechin raised his stake in the nation’s biggest oil producer.
The Micex Index (INDEXCF) added 0.3 percent to 1,373.40 by 10:22 a.m. in Moscow, after tumbling to the lowest since Aug. 8 yesterday. OAO Magnitogorsk Iron & Steel increased 1.3 percent to 8.323 rubles. Rosneft climbed 1.1 percent to 241.52 rubles with volume at about 36 percent of the three-month daily average. The stock has a 5 percent weighting on the Micex, the fifth-biggest.
Sechin boosted his stake in Rosneft to 0.0849 percent from 0.0075 percent, according to a regulatory filing from the company. The Micex gauge lost 1.9 percent in four days of declines after Russia lowered its 2013 economic-growth forecast for the second time this year to 1.8 percent from 2.4 percent.
“We’re seeing equities bounce back today after a selloff,” Sergey Fundobny, head of research at Arbat Capital, said by phone from Moscow. “We saw a significant outflow from riskier assets earlier this week.”
The MSCI Emerging Markets Index added 0.9 percent, the first increase in three days. The U.S. and the U.K. said yesterday that they are prepared to take military action against Syria without authorization from the United Nations Security Council after Russia objected to a resolution granting action to protect civilians.
Russia’s economy expanded 1.2 percent in the second quarter, the Federal Statistics Service reported on Aug. 9, missing the median forecast of 2 percent of economists surveyed by Bloomberg. That may mean the nation has entered its second recession in five years, according to London-based Capital Economics Ltd.
The central bank refrained from cutting interest rates for an 11th month on Aug. 9, while highlighting “significant” risks to growth.
OAO M.video, Russia’s biggest electronics retailer, gained 1 percent to 254.01 rubles. Sales in the first half jumped 14 percent from a year earlier to 78.5 billion rubles ($2.4 billion), the company said yesterday in a statement.
Russian equities have the cheapest valuations among 21 emerging economies tracked by Bloomberg at 5.2 times 12-month estimated earnings, compared with a multiple of 9.8 for the MSCI Emerging Markets Index. The dollar-denominated RTS Index (RTSI$) added 0.4 percent to 1,304.62.
Crude oil futures lost 1 percent to $109.03 a barrel in New York. Brent retreated 1 percent to $115.47 a barrel in London. Russia receives about half of its budget revenue from oil and natural-gas sales.
The volume of shares traded on the Micex was 68 percent below the 30-day average today, while 10-day price swings subsided to 10.7, the lowest since July 31, data compiled by Bloomberg show.
The Bloomberg Russia-US Equity Index of the most-traded Russian stocks in New York was little changed at 90.80 yesterday, while the Market Vectors Russia (RSX) ETF, the largest dedicated Russian exchange-traded fund, lost 0.2 percent to $25.84.
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