Russian stocks rose from the lowest level in two weeks, led by OAO Rostelecom and OAO GMK Norilsk Nickel, as the world’s biggest producer of the metal said it will consider an interim dividend and after crude oil gained.
The Micex Index added 0.1 percent to 1,504.48 at the close in Moscow after earlier dropping as much as 0.6 percent. The benchmark slipped 1.9 percent in the past five days after West Texas Intermediate fell below $100 a barrel on Oct. 21. Fixed-line operator Rostelecom and Norilsk were the two biggest advancers in percentage terms on the Micex today, outweighing a decline in OAO Magnit, the country’s largest retailer.
Norilsk’s board plans to discuss the potential dividend on Oct. 29, the company said in a statement today, pushing the stock to a six-month high. Crude, Russia’s main export earner, rose as much as 0.8 percent to $97.88 in New York, trimming its weekly retreat to about 3 percent, as U.S. orders for durable goods in September increased the most in three months. Brent oil headed for a third day of losses in London.
Russian equities have the cheapest valuations among 21 emerging economies monitored by Bloomberg, contributing to a “stealth rally” on the Micex today, Julian Rimmer, a trader at CF Global Trading UK Ltd., said by e-mail from London.
The index is trading at 4.4 times projected 12-month earnings, compared with a multiple of 10.6 for the MSCI Emerging Markets Index. Ten-day price swings rose to 15.829 from 15.807 yesterday.
Thirty stocks on the gauge retreated today, while 19 advanced, data compiled by Bloomberg show. Moscow-based Rostelecom posted the steepest rally on the measure, with shares climbing 3.7 percent to 115.30 rubles, extending yesterday’s 4.8 percent surge to a six-month high.
“The rally is likely related to the expected spinoff of mobile assets,” Joseph Dayan, head of markets at BCS Financial Group in London, said in e-mailed comments. “This could be treated as a reorganization that might then be followed by an obligatory buyback.”
Krasnodar-based Magnit declined 1.7 percent after a decrease of 1.3 percent yesterday, closing at 8,320 rubles. The stock has the fourth-biggest weighting on the benchmark stock index.
Magnit, which is up 72 percent in 2013, will probably report third-quarter results on Oct. 28, data compiled by Bloomberg show. The retailer may post record earnings before interest, taxes, depreciation and amortization, with a margin of 11.5 percent, Mikhail Krasnoperov, a Moscow-based analyst at Sberbank CIB, said in an e-mailed note today. Krasnoperov expects “substantial upside” to the company management’s guidance, according to the note.
Today’s decrease was “simply profit-taking” before the results, Kirill Yankovskiy, director of equity sales at UralSib Capital in London, said in e-mailed comments. “Some people tend to think it’s getting harder for Magnit to surprise positively.”
The dollar-based RTS Index slipped 0.1 percent to 1,492.20, dropping for a third day and capping the week with a decrease of 1.6 percent.