Russia’s Micex Index Pares 2013 Gains as Mechel Shares Retreat

Most Russian shares fell, curbing this year’s advance, as OAO Mechel declined.

The Micex Index (INDEXCF) lost less than 0.1 percent to 1,500.26 by 10:18 a.m. in Moscow, trimming its increase in 2013 to 1.7 percent and reducing its advance in December to 1.4 percent. Of 50 stocks, 32 dropped, 14 rose and four were little changed. Mechel, the nation’s biggest coking-coal producer fell 1.3 percent to 67 rubles, taking its slump this year to 67 percent.

The Micex has climbed 0.9 percent since the Federal Reserve announced plans on Dec. 18 to cut its monthly bond purchases by $10 billion to $75 billion, citing an improved outlook for the U.S. employment market. Stocks were also boosted by President Vladimir Putin’s decision to pardon imprisoned former Yukos Oil Co. owner Mikhail Khodorkovsky last week. U.S. and most global markets were closed for Christmas Day yesterday.

“In the absence of foreign players, the market is quiet,” Evgeny Shatrov, a trader at Sberbank CIB in Moscow, said by phone. “There’s little liquidity. I’m expecting the market to rise further before the year-end.”

The Moscow bourse is shut for five days for New Year and Russian Orthodox Christmas holidays with trading Jan. 6 and Jan. 8.

Redemptions from Russia-dedicated equity funds reached $3.59 billion in 2013 through Dec. 18, the most since EPFR Global started tracking flows in 1996, the Boston-based research firm said by e-mail on Dec. 20.

The dollar-denominated RTS Index (RTSI$) declined less than 0.1 percent to 1,446.50. Russian equities have the cheapest valuations among 21 emerging-market economies monitored by Bloomberg, with shares on the benchmark trading at 4.5 times projected 12-month earnings compared with a multiple of 10.4 for the MSCI Emerging Markets Index.

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

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