OAO Magnit surged to a record after Bank of America Corp. Merrill Lynch raised its recommendation for global depositary receipts to buy, citing Russia’s biggest food retailer by market value as an industry favorite.
Magnit gained as much as 6.1 percent before trading up 3.8 percent at $43.56 by 3:03 p.m. in London, poised for the highest level since its April 2008 listing. In Moscow, the stock rallied 4.6 percent to 5,370.6 rubles, the strongest level since their listing in July 2006. The volume of shares traded was 94,096, equivalent to 1.6 times the stock’s three-month average.
Merrill Lynch raised its recommendation to buy from neutral, according to an e-mailed report. Magnit was the biggest gainer on the Russian Depositary Index and the third-biggest gainer on the Micex Index, which closed down less than 0.1 percent.
“Magnit remains our top pick for having the strongest execution in the industry, organic space growth and record margins,” Victor Dima, an analyst at Merrill Lynch in Moscow, said in the report.