Russia Stocks Have Best Week Since 2011 on Stimulus Speculation

Russian stocks had their biggest weekly gain since December 2011 as crude advanced and investors speculated U.S. stimulus measures won’t be trimmed.

The Micex Index added 0.1 percent to 1,423.40 by the close in Moscow for an increase of 4.3 percent in the week. OAO Gazprom, the country’s natural gas export monopoly, rose 1.4 percent to 141.97 rubles. OAO Rosneft, its biggest oil producer, rallied 1.6 percent to 264 rubles. The volume of shares traded on the Micex was almost double the 30-day average.

The gauge pared an advance of as much as 1.9 percent earlier after President Vladimir Putin said Russia would continue to assist Syria if it’s attacked. Crude oil, Russia’s main export earner, jumped 1.1 percent to $116.47 a barrel in London. U.S. payroll data was weaker than forecast by economists, spurring bets the Federal Reserve won’t pare its bond-buying program and stoking appetite for riskier emerging-market assets.

The U.S. data have “certainly injected an element of uncertainty into what was already a subject for intense debate,” Julian Rimmer, a trader at CF Global Trading UK Ltd. in London, said by e-mail. “Russia was already performing gallantly and there is now some momentum developing.”

Gazprom added 1.9 percent to $8.48 in London, while Rosneft increased 2.3 percent to $7.91. The ruble climbed 0.2 percent today against the dollar, reducing its slide since the start of the year to 8.8 percent.

“For the oil and gas sector, the combination of a weak ruble and high oil price is very positive,” Mark Rubinstein, head of research at IFC Metropol in Moscow, said by phone. “Gazprom was trading at very cheap levels, investors have finally noticed that.”

Dixy Drops

Dixy Group, Russia’s third-largest food retailer, tumbled 4.7 percent to 413.99 rubles. The company reduced its earnings before interest, taxes, depreciation and amortization estimate for 2013 yesterday, leading VTB Capital to cut the stock to hold.

Russian equities have the cheapest valuations among 21 emerging economies tracked by Bloomberg, with shares trading at 3.7 times 12-month estimated earnings, compared with a multiple of 10.3 for the MSCI Emerging Markets Index. The dollar-denominated RTS Index was little changed at 1,339.05.

Investors pulled a net $535 million out of Russian equities in the week ended Sept. 4, according to an e-mailed note today from VTB Capital, which cited EPFR Global data.

The Bloomberg Russia-US Equity Index of the most-traded Russian stocks in New York rose 0.3 percent, while the Market Vectors Russia ETF, the largest dedicated Russian exchange-traded fund, gained 0.7 percent.

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