Russian Stocks Gain on Magnit as Aeroflot Extends Jump on Profit

Russian shares rose to the highest level in a week as OAO Aeroflot extended gains after the carrier’s profit almost doubled and as better-than-expected Chinese export data spurred emerging-market assets.

The benchmark Micex Index climbed 1.2 percent to 1,465.70 by the close in Moscow. Aeroflot, Russia’s biggest airline, jumped 5.9 percent to 72.55 rubles, the highest level since May 2011. The stock was the biggest gainer on the Micex in percentage terms as volume rose to 6.9 million shares, triple the three-month daily average. OAO Magnit, the nation’s biggest food retailer, added 3.2 percent to 9,007.20 rubles.

The Micex is recovering after a 3.7 percent drop in the past two weeks pushed the measure’s 12-month price-to-earnings ratio to 4.17 on Dec. 6, the cheapest among 21 emerging-market economies monitored by Bloomberg. Aeroflot increased for a second day after the airline reported an 88 percent jump in third-quarter profit. Consumer services shares gained 3.1 percent, the most among the Micex’s nine industry groups.

“I expect the Micex to finish the year at 1,500,” Vladimir Bragin, head of research at Alfa Capital in Moscow, where he helps manage $2.9 billion, said by phone. “It makes sense to buy at the moment, there’s growth opportunity here. Aeroflot posted good results. Magnit is a good company.”

A gauge tracking consumer-goods companies rose 1.8 percent while the Micex health care index advanced 2.2 percent. The measure of oil and gas stocks, Russia’s biggest industry, climbed 1.4 percent.

Tatneft Buy

OAO Tatneft, a regional oil producer, jumped 1.1 percent to 198.56 rubles, while the London-listed stock increased 2.2 percent to $36.62 at 3:20 p.m. in London. Renaissance Capital Group Inc. raised its recommendation on the stock to buy from hold, increasing its price estimate to $50, according to an e-mailed note today.

Magnit’s London-listed stock gained 3.7 percent to $65.80 today, while the shares in Russia are up 87 percent this year.

Emerging-market stocks rose the most in three weeks after data showed China’s November trade surplus widened to the largest in more than four years, a sign global demand is helping sustain a recovery in the world’s second-biggest economy.

The Micex slumped 2 percent in November, the worst month since May, amid concern the nation’s economy is foundering. Russia cut its 2014 economic growth forecast to 2.5 percent from 3 percent, Interfax reported last week, citing Economy Minister Alexei Ulyukayev. This year’s inflation forecast was raised to 6.2 percent from 6 percent, the news service said.

Russia-dedicated stock funds lost $90 million in the week to Dec. 4, UralSib Capital said in a note last week, citing EPFR Global data. Redemptions reached $3.52 billion in 2013 through Nov. 29, the most since the Boston-based research firm started tracking flows in 1996, EPFR Global said by e-mail Dec. 3.

The dollar-denominated RTS Index gained 1.5 percent today to 1,412.08, the highest since Nov. 26.

Before it's here, it's on the Bloomberg Terminal.