Russian equities increased for the second day as crude oil climbed while U.S. lawmakers prepared for talks to avert spending cuts and tax increases that threaten the economy of the world’s biggest crude consumer.
The 50-stock Micex Index added 0.3 percent to 1,478.61 by the close in Moscow, with 37 stocks climbing, one little changed and 12 dropping. The gauge has added 5.5 percent this year. OAO Rosneft, Russia’s largest oil producer, advanced 1.3 percent. The stock has the fourth-largest weighting in the index at 6.1 percent. Preferred shares of oil producer OAO Surgutneftegas rose 0.7 percent.
Crude oil rallied 2.6 percent to $90.95 in New York. Russia receives about half of its budget revenue from the oil and gas industry. Democrats and Republicans plan to convene tomorrow for talks aimed at avoiding more than $600 billion in tax gains and spending cuts, known as the fiscal cliff, which are scheduled to take effect Jan. 1. European markets remained closed today for Christmas holidays, while U.S. markets opened.
Investors in Russia have “no incentive to trade actively before there is more clarity on the fiscal cliff in the U.S.,” Slava Smolyaninov, an analyst at UralSib Capital, said in an e-mailed report before the close of trading in Moscow.
The amount of shares traded on the gauge was 58 percent below the 10-day average, according to data compiled by Bloomberg. Failure to reach an agreement would push the U.S. into recession for the first half of 2013, the nonpartisan Congressional Budget Office has said.
Russian markets’ last day of trading this year is Dec. 28 before closing for New Year and Christmas holidays in the first week of 2013. Trading resumes Jan. 8.
Industrial shares added 1.2 percent on average, the biggest gainers among nine sector groups on the Micex. Consumer, telecommunications and oil and gas shares gained 0.5 percent on average.
OAO Uralkali, the largest potash producer by output, rose 0.8 percent to 237.03 rubles. Based on suggestions from the Federal Anti-Monopoly Service, the company will price domestic potash at a level not exceeding the minimum export contract price, Uralkali said in a statement today. The amount of shares traded was 1 million, equivalent to about 41 percent of the three-month average.
The RTS Index, Russia’s dollar-denominated equity gauge, increased 0.8 percent to 1,526.34. The Bloomberg Russia-US stocks measure dropped 0.5 percent to 97.02 on Dec. 24.
The Micex trades at about 5.4 times estimated earnings. That compares with a multiple of 10.6 times for the MSCI Emerging Markets Index, which has gained 14 percent.
Russian equities have the lowest valuations based on estimated earnings among 21 emerging markets tracked by Bloomberg.