Russian stocks rose for a second day as OAO Uralkali, the nation’s biggest potash producer, appealed to authorities to intervene to resolve a conflict with Belarus, which detained the company’s chief executive officer last week.
The Micex Index gained as much as 1.2 percent before ending 0.5 percent higher at 1,373.82 at the close in Moscow. OAO Sberbank, the nation’s largest lender, increased 1.1 percent to 90.47 rubles, the biggest advancer by index points on the benchmark gauge. Uralkali climbed 1.9 percent, the most since Aug. 22, to 159.40 rubles.
Uralkali has asked Russian authorities to help stop “politically motivated persecution” of employees by Belarus, saying in an e-mailed statement it rejects all accusations against them. Belarus has started a criminal investigation into shareholder and billionaire Suleiman Kerimov, the state-run news agency Belta said yesterday. Uralkali CEO Vladislav Baumgertner was charged last week in his capacity of chairman of Belarusian Potash Co., a venture that Uralkali quit in July.
The “Uralkali stock’s increase is based on the investors’ hope that Russia will resolve the conflict,” Elena Sadovskaya, an analyst at Rye, Man & Gor Securities, said by phone from Moscow. “All Russian officials, maybe besides the patriarch, have been saying from the beginning that Baumgertner should be released.”
Uralkali said it will use state and legal channels to combat Belarus’ accusations, according to today’s statement. Baumgertner was held after traveling to Belarus for talks at the invitation of Belarusian Prime Minister Mikhail Myasnikovich. The CEO said July 30 he was dissolving Uralkali’s venture with state-run Belaruskali because Belarus had “violated” the agreement by authorizing Belaruskali to export some of its potash independently.
Russian stocks pared an advance of as much as 1.2 percent after Israel carried out a missile test launch, stoking concern that conflict in the Middle East will escalate. Brent crude increased 0.8 percent at $115.23 a barrel.
OAO Gazprom, which has the biggest weighting on the Micex at 16 percent, erased gains of as much as 1.2 percent, closing 0.1 percent lower at 131.30 rubles. The natural gas-export monopoly may boost its 2013 investment program, Yaroslav Golko, a member of the management board, said today in a first-quarter conference call. The company’s London-traded shares lost 0.3 percent to $7.83.
Gazprom’s profit increased 6 percent in the period to 381 billion rubles ($11 billion), as fuel exports increased and it paid less to clients for retroactive discounts than planned.
M.video, Russia’s biggest electronics retailer, surged 4.4 percent to 282.98 rubles after VTB Capital raised the stock’s price estimate by 8 percent to 430 rubles. VTB reiterated its buy recommendation, citing the discount to emerging-market peers, according to an e-mailed note today.
Russian equities have the cheapest valuations among 21 emerging economies tracked by Bloomberg, with shares trading at 5 times 12-month estimated earnings, compared with a multiple of 9.3 for the MSCI Emerging Markets Index. The dollar-denominated RTS Index closed little changed at 1,293.11.
The volume of shares traded on the Micex was 11 percent above the 30-day average today, while 10-day price swings climbed to 11.232, data compiled by Bloomberg show.