Most Russian equities fell as crude oil, the nation’s biggest export earner, slipped below $100 a barrel for the first time since July.
Twenty-eight stocks declined and 20 gained even as the the Micex Index closed less than 0.1 percent higher at 1,533.61 by the close in Moscow. The gauge has rallied 19.6 percent from this year’s low in June. OAO Gazprom, the natural-gas export monopoly, dropped 0.5 percent to 156.12 rubles and lost 0.8 percent to $9.74 in London. OAO Uralkali, the world’s biggest potash producer, surged 3.1 percent to 179.30 rubles, the most since Sept. 16, leading Micex increases by index points.
Crude slid 0.9 percent to $99.87 in New York. Gazprom has advanced 8.5 percent this month and the stock, which has the biggest weighting on the Micex, is trading up 46 percent from a June 24 low in Moscow. Belarus President Aleksandr Lukashenko called for billionaire Mikhail Gutseriev to buy Suleiman Kerimov’s Uralkali stake, state-owned Belta news agency reported today.
“Gazprom had been one of the best-performing stocks, today some players are fixing profits,” Mansur Mammadov, a fund manager at Kazimir Partners, which oversees $300 million in assets, said in a phone interview from Moscow. “Although oil is still at comfortable levels for Russia, we don’t expect strong growth going forward.”
Russia’s economic expansion won’t exceed 2 percent this year, Prime Minister Dmitry Medvedev said today. The Economy Ministry in August cut its growth forecast for the year to 1.8 percent from 2.4 percent.
Billionaire investor Kerimov, who shares a 33 percent stake in Uralkali with two partners, has been getting offers to sell his holding after Chief Executive Officer Vladislav Baumgertner was arrested in Belarus in August. Gutseriev, billionaires Mikhail Prokhorov and Vladimir Evtushenkov and former banker Vladimir Kogan are among potential bidders, people familiar with the offers said last month.
Utilities climbed the most among the nine main industry groups, rising 1.5 percent on average. OAO RusHydro added 1.7 percent to 57.15 kopeks and 1.1 percent to $1.729 in London. OAO Russian Grids gained 7 percent to 91.4 kopeks.
The Micex rallied 1.3 percent last week after President Barack Obama signed into law a measure ending the 16-day government shutdown and extending the nation’s borrowing authority until early next year. The Federal Reserve will delay the first reduction in its bond purchases until March after the government shutdown slowed fourth-quarter growth and interrupted the flow of data, according to a Bloomberg survey.
“The cost of funding is becoming the most important issue for the markets,” Aleksei Belkin, who helps manage about $4.4 billion in assets as chief investment officer at Kapital Asset Management LLC in Moscow, said by phone. “The market is playing with the idea that the less clarity we see with the U.S. budget, the more the stimulus tapering will be pushed back.”
OAO Novatek added 0.5 percent to 409.17 rubles, after rising as much as 1.7 percent. President Vladimir Putin signed a decree that would allow Russia’s second-biggest gas producer to pay no extraction tax and export duty on Gydan peninsula natural gas if it’s transported to a liquefied natural gas plant in Yamal, according to a Kremlin website statement dated Oct. 15.
The RTS Index retreated 0.2 percent to 1,514.39. The dollar-denominated gauge rose 20 percent from this year’s low to enter a bull market on Oct. 10.
Russian equities have the cheapest valuations among 21 emerging economies monitored by Bloomberg, with shares on the index trading at 4.4 times projected 12-month earnings, compared with a multiple of 10.8 for the MSCI Emerging Markets Index. Ten-day price swings on the Micex dropped to 14.38 from 16.29 on Oct. 18.