Most Russian shares fell, paring this year’s advance, amid record outflows from equity funds as power stocks declined ahead of New Year’s holidays.
The Micex Index slid less than 0.1 percent to 1,506.41 by the close in Moscow, trimming this year’s gain to 2.2 percent December’s increase to 1.8 percent. Federal Grid Co., OAO Inter RAO UES and OAO Russian Grids all dropped more than 1.5 percent.
Redemptions from Russia-dedicated equity funds reached $3.59 billion in 2013 through Dec. 18, the most since EPFR Global started tracking flows in 1996, the Boston-based research firm said by e-mail on Dec. 20. Trading halts on Dec. 31 until Jan. 6 for the New Year’s break. The bourse will also be closed on Jan. 7 for Russian Orthodox Christmas.
“Pessimists have left Russia at this point, we’ve seen large redemptions from equity funds,” 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 traditionally doesn’t do much prior to the holidays as people have already made most of the changes to their portfolios.”
Russian stocks gained this month after President Vladimir Putin pardoned imprisoned former Yukos Oil Co. owner Mikhail Khodorkovsky. Two members of the Pussy Riot punk group were also freed yesterday under an amnesty signed by Putin.
OAO Aeroflot, the nation’s biggest airline, increased 3.1 percent to 84.11 rubles, the highest since December 2010. The stock has advanced 87 percent this year, the second-best Micex performer after OAO Magnit.
Crude oil traded 0.3 percent higher in London to $111.94 per barrel. Russia receives about half of its budget revenue from oil and natural gas sales.
The dollar-denominated RTS Index was little changed at 1,454.02. Russian equities have the cheapest valuations among 21 emerging-market economies monitored by Bloomberg, with shares on the benchmark trading at 4.5 times projected 12-month earnings compared with a multiple of 10.5 for the MSCI Emerging Markets Index.