Russia Stocks Trim Drop After U.S. Jobs Data as Uralkali FallsKsenia Galouchko
Russian stocks pared declines from an eight-month high after U.S. jobs data missed estimates. OAO Uralkali fell after a report billionaire Vladimir Evtushenkov won’t buy a stake in the potash producer.
Uralkali lost 2.5 percent, the biggest drop since Sept. 27, at the close in Moscow on volume 59 percent the three-month daily average. Natural-gas export monopoly OAO Gazprom decreased 1.4 percent to 153.9 rubles, leading declines on the benchmark Micex Index, which lost 0.3 percent.
The Micex trimmed a drop of as much as 0.7 percent after U.S. payrolls climbed less than forecast in September, supporting bets the Federal Reserve will delay tapering monetary stimulus. Evtushenkov said the price that Suleiman Kerimov is seeking for a stake in Uralkali is too high, state-run Interfax news agency reported today.
“The worse the jobs data, the further away is the Fed tapering,” Stanislav Kopylov, who helps manage about $3 billion at UralSib Asset Management in Moscow, said by phone.
The Federal Reserve will probably 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 declines today reduced the Micex’s advance from this year’s low in June to 19 percent. Crude rose as much as 0.6 percent to $99.77 in New York, after earlier dropping by the same amount, and traded at $99.12 as of 3:33 p.m. in London. Russia receives about half its budget revenue from natural gas and oil industry sales.
London-traded shares of TCS Group Holding Plc increased to 18.3 in their trading debut after the first initial public offering by a Russian company in London since November. TCS Group, which owns Russian consumer lender Tinkoff Credit Systems, sold shares at $17.50 each in the $1.09 billion offering, the top end of the range, according to a company statement today.
“This is an interesting asset because they have a narrow focus on credit cards and we expect demand for credit cards to only rise in Russia,” Vladimir Savov, an analyst at Otkritie Financial Corp. in Moscow, said by phone. “This is a private company that’s not dependent on the state. Investors, seeing this, prefer to buy into the stock despite the high valuation.”
The RTS Index increased 0.3 percent to 1,518.54, taking its advance since a June low to 23 percent. Russian equities have the cheapest valuations among 21 emerging economies monitored by Bloomberg, with shares on the Micex 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 fell to 14.43 from 14.383 yesterday.