Russia Stocks Climb 4th Day on Europe Stimulus Bets; X5 Advances

Russian stocks rose for a fourth day as investors bought riskier assets on bets European policy makers will contain the region’s debt crisis.

The Micex Index added 1.6 percent to 1,428.62 by the 6:45 p.m. close in Moscow, extending its winning streak to the longest in almost a month. Oil producer OAO Surgutneftegas increased 2.1 percent. OAO Magnit, Russia’s largest food retailer by market value, jumped 3.5 percent.

Leaders in Berlin, Paris and Rome have backed European Central Bank President Mario Draghi’s approach to combat the sovereign debt crisis, saying they will do what’s needed to protect the euro. The ECB’s Governing Council is scheduled to meet on Aug. 2 while the U.S. Federal Reserve’s Federal Open Market Committee will consider the need for more stimulus at a two-day meeting that concludes on Aug. 1.

“This week will start with an extension of the optimism that helped the rally over the last two days,” Chris Weafer, Troika Dialog’s chief strategist, said in an e-mailed research note today. “This optimism rests on the hope that the Fed and ECB may take actions this week to boost economic activity and reduce risk.”

Crude oil, the nation’s chief export earner, was little changed at $90.07 a barrel in New York, near the highest level in a week. Oil and gas contribute about 50 percent of state revenue.

The Micex trades at 5.2 times estimated earnings, having gained 1.6 percent this year. That compares with a multiple of 9.7 times for companies in the MSCI Emerging Markets Index, which has added 3.5 percent this year.


The dollar-denominated RTS Index increased 1.1 percent, rising for a fourth day, to 1,398.07, the highest level in a week. The Russian Depositary Index of London-traded stocks advanced 1.4 percent to 1,586.36.

X5 Retail Group NV, the country’s largest food retailer by revenue, snapped three days of losses after Vedomosti reported Stephan DuCharme, the company’s acting chief executive officer, may be appointed to the post on a permanent basis. X5 erased a 0.4 percent drop to trade up 1.4 percent at $19.55 in London.

The RTS stock-index futures expiring in September rose 1 percent to 139,080 today. The Market Vectors Russia ETF, the biggest U.S.-traded exchange-traded fund that holds Russian shares, jumped 3.8 percent to $27.21 on July 27, increasing 1.8 percent on the week, for a third consecutive gain. The RTS Volatility Index, which measures expected swings in the index futures, gained 6 percent today to 32.51.

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