Russia Stocks Rally Third Day as Basheft Jumps on Dividends

Russian stocks rose for a third day as shares of OAO Bashneft jumped after the oil producer announced plans for an interim dividend.

The Micex Index added 0.3 percent to 1,516.17 at the close in Moscow. Bashneft preferred stock surged 5 percent, the most since Aug. 21. Its ordinary shares closed up 1.9 percent at 1,942.70 rubles. OAO Rosneft, Russia’s biggest oil producer, erased gains to trade little changed at 253.70 rubles.

Bashneft may pay 199 rubles ($6.23) a share on income through the first nine months of the year, the Ufa-based company said today. It cut the payout on 2012 earnings to 24 rubles a share from 99 rubles a year earlier. Crude oil, Russia’s main export earner, dropped 0.3 percent to $98.34 per barrel in New York. U.S. central bankers begin a two-day meeting today to discuss their $85 billion in monthly bond purchases.

Bashneft’s dividend “exceeded expectations by one third” and gives a yield of 10 percent for ordinary shares and 14 percent for preferred stock, Luis Saenz, head of equity sales and trading at BCS Financial Group in London, said by e-mail. That’s “the highest among peers,” he said.

Rosneft rose as much 1.5 percent as earlier after posting an eightfold increase in third-quarter profit as it recorded a 167 billion-ruble gain on the value of TNK-BP.

Shares of the Moscow Exchange tumbled 2.1 percent to 63.72 rubles. The bourse is planning a share sale in the first six months of 2014 that will include at least part of the central bank’s stake, Reuters reported, citing people familiar with the matter.

Russian equities have the cheapest valuations among 21 emerging economies monitored by Bloomberg. The index is trading at 4.4 times projected 12-month earnings, compared with a multiple of 10.7 for the MSCI Emerging Markets Index.

The dollar-based RTS Index slipped 0.1 percent to 1,491.56.

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