Russian Stocks Jump Sixth Day as Putin Pledges to End ConflictPriyanka Sharma
Russian stocks gained for the sixth day, with the benchmark Micex Index headed for its strongest weekly performance since May, after President Vladimir Putin pledged to work to end the deadly conflict with Ukraine.
The Micex increased 0.6 percent to 1,416.53 at 3:21 p.m. in Moscow. The gauge rose 5 percent this week, the steepest such advance since the period ended May 9. Thirty-seven stocks climbed, while 12 retreated and one was unchanged. OAO Lukoil, Russia’s second-biggest natural gas producer, added 1.3 percent in the largest increase on the index.
Putin pledged yesterday to “do all we can” to bring the bloodshed in Ukraine to an end in a meeting with political leaders during a visit to the Crimea peninsula he annexed in March. European Commission President Jose Barroso agreed to meet with Putin to discuss relations between Moscow and the European Union, more than two weeks after the bloc imposed further sanctions on Russia.
“We had general pricing of hopes for de-escalation in the Ukrainian conflict this week,” Kirill Yankovskiy, director of equity sales at Otkritie Capital in London, said by e-mail. “Putin’s comments revealed no major intent to escalate the situation. They were in a very constructive tone and very restrained, so market took it as a positive sign.”
A humanitarian aid convoy from Russia prompted Ukraine to warn it may be a guise to bring military gear into the country’s war-torn eastern regions. The government in Kiev said it would accept the convoy if the Red Cross distributes the aid after customs and border officers examine it.
The Micex has retreated 2 percent since the end of February, before Russia’s incursion into Ukraine’s Crimea peninsula. The measure trades at 5 times estimated earnings, compared with a multiple of 5.3 before the intervention and making it the cheapest market among developing nations.
Food retailer OAO Magnit gained 1.8 percent, taking its six-day gain to 9.1 percent. OAO Gazprom, Russia’s natural-gas export monopoly, rose 0.6 percent, increasing for a third day.
The company trades at 2.8 times estimated earnings, the lowest among its 15 major peers worldwide, data compiled by Bloomberg show.
The dollar-denominated RTS Index increased 0.6 percent, taking its weekly advance to 5.9 percent. Twenty-six stocks on the Micex traded above their 50-day moving average yesterday, the most this month and up from a four-month low of 10 reached on Aug. 7.