Russian stocks rose to the highest level in almost four weeks as United Co. Rusal, the world’s biggest aluminum producer, surged after President Vladimir Putin pushed for lower interest rates for producing companies.
The Micex Index (INDEXCF) climbed as much as 0.7 percent to 1,505.48, the highest level since Dec. 26, before trading 0.4 percent higher at 12:22 p.m. in Moscow. Rusal surged 11 percent, the biggest gain on record, to 117.25 rubles. Polymetal International Plc, a gold and silver miner, rose 3.1 percent to 323.76 rubles.
Putin yesterday ordered central bank head Elvira Nabiullina to work to cut the interest rates at which industrial companies borrow, the Kremlin said on its website. Rusal signed an accord with OAO Phosagro for 26.5 billion rubles of longterm supplies, a regulatory filing today showed. Polymetal’s full-year output rose 21 percent from a year earlier to 1.28 million ounces of gold equivalent in 2013, according to a statement today.
Rusal’s gains “are a reaction to Putin’s calls to banks to reduce corporate rates for producing companies,” Slava Smolyaninov, chief strategist at UralSib Capital LLC in Moscow, said by phone. “Polymetal posted good results and is keeping its costs under control.”
OAO Alrosa, the nation’s biggest diamond producer, gained 1.7 percent to 33.30 rubles. Natural gas producer OAO Gazprom, OAO Lukoil and OAO Novatek also advanced.
The Micex Index is less than 0.1 percent lower this year. The dollar-denominated RTS Index (RTSI$) was little changed at 1,394.37, down 3.3 percent in 2014.
“The market is quietly waiting for new economic developments both from the U.S. and domestically,” Smolyaninov said.
Russian equities have the cheapest valuations among 21 developing-nation economies monitored by Bloomberg, with shares on the benchmark Micex trading at 3 times projected 12-month earnings, compared with a multiple of 9.2 for the MSCI Emerging Markets Index.
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