Dec. 2 (Bloomberg) -- Russian stocks advanced to a more than two-year high as steelmakers surged after the country won its bid to host the 2018 World Cup. OAO Wimm-Bill-Dann soared after PepsiCo Inc. said it will acquire a controlling stake in the dairy company.
The Micex Index climbed 1.9 percent to 1,632.37, the 30-stock gauge’s highest level since July 2008. OAO Severstal and OAO Novolipetsk Steel jumped as investors speculated they will benefit as the country builds new stadiums, roads and airports for the event.
Russian Prime Minister Vladimir Putin hailed the victory as “a day for rejoicing” and said the win would help the country to overhaul its infrastructure. The Micex climbed before the decision after pending home resales in the U.S. jumped a record 10 percent in October, easing concern that the global economic recovery will slow.
“This is great news for steel companies and transport and construction names,” Chris Weafer, chief strategist at UralSib Financial Corp., said by phone from London. “The government can no longer afford to dither on its $1 trillion program for improving Russia’s infrastructure.”
Severstal, Russia’s largest steelmaker, rallied 4.6 percent to 477.76 rubles by the 6:45 p.m. close in Moscow. Novolipetsk and OAO Mechel climbed 4.9 percent and 3.7 percent respectively.
Russia’s bid includes construction of 13 stadiums and renovation of three more at a projected cost of $3.8 billion and an operating budget of $641 million for 2017-2018. Russia pledged to make “major upgrades and capacity increases” at most airports serving the 13 proposed host cities.
Wimm-Bill-Dann jumped 58 percent, the most on record, to 3,634.42 rubles. PepsiCo’s $3.8 billion offer for a 66 percent stake values the company at $33 per American depositary receipt, or about $132.00 per ordinary Russian share.
Oil, Russia’s chief export earner, rose to the highest level in more than two weeks after the European Central Bank President Jean-Claude Trichet said the bank will delay its withdrawal of stimulus measures. The ruble slid 0.2 percent to 31.48 per dollar and added 0.3 percent to 41.1650 by the end of official trading at 5 p.m.
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