Russian stocks gained for a second day, led by OAO Gazprom and OAO Lukoil, as foreign ministers gathered for four-party talks aimed at resolving the Ukraine conflict.
The Micex Index rose 2.1 percent to 1,514.33 by the close in Moscow, the most since June 24, with 44 stocks out of 50 climbing. Gazprom, the nation’s biggest gas producer, increased 2 percent and Lukoil, the No. 2 oil company, climbed 2.2. Gazprom’s ex-dividend date is July 16 and Lukoil’s is July 14.
Stocks were buoyed by the prospect of a meeting in Berlin between the foreign ministers of Ukraine, Russia, Germany and France. The talks, which are underway, will “try and reduce tensions,” Maria Zakharova, a Russian Foreign Ministry spokeswoman, said by phone. The European Union and the U.S. are considering expanding sanctions imposed on Russia after its annexation of Crimea in March.
“Any steps toward peace are positive for the market,” Evgeny Loktyukhov, an analyst at OAO Promsvyazbank in Moscow, said by phone today. “I don’t see reasons for a new round of sanctions against Russia. Energy shares are being supported by the dividend factor before the cutoff dates.”
OAO Moscow Exchange shares fell as much as 5.2 percent and closed up 1.1 percent at 65.75 rubles. Russia’s central bank sold 11.75 percent of its stake in the exchange at 60 rubles per share, a 7.8 percent discount to the closing price on July 1. The size of the offering was about 16.04 billion rubles ($467 million), according to the exchange. The regulator plans to exit its holding by Jan. 1, 2016, according to its website.
Russian Direct Investments Fund, in a consortium with international investors, said it bought an undisclosed stake in the bourse during the placement, according to an e-mailed statement from the fund.
“I don’t think it has much downside from these levels as the stock looks cheap compared to peers and there is a possibility its weighting will increase in the MSCI indexes,” Olga Naydenova, an analyst at BCS Financial Group in Moscow, said in e-mailed comments. She rates Moscow Exchange a buy with a 12-month price target of 81 rubles per share.
OAO Bashneft surged 7.5 percent to a record 2,591 rubles. The oil producer’s board of directors meets tomorrow and plans to discuss an additional share placement, according to a press statement.
The Micex entered a bull market June 6 after rising more than 20 percent from a low on March 14, the last trading day before citizens of Ukraine’s Crimea peninsula voted in favor of joining Russia.
The Micex trades at 5.6 times estimated earnings, the cheapest among 21 emerging markets tracked by Bloomberg. That compares with a multiple of 5.3 percent at the end of February before Russia’s incursion in Crimea. The dollar-denominated RTS Index climbed 2.1 percent to 1,390.47.
“The general move is on global optimism, as we are back to pre-Crimea levels, while fundamentally nothing has improved,” Vladimir Vedeneev, chief investment officer at Raiffeisen Capital in Moscow, said in e-mailed comments. “There is concentrated demand in individual stories.”