Russia’s Micex Gains Second Day as Exporters Rise on Weak Ruble

Russian stocks advanced for the second day, led by metal, oil and natural gas producers, as the depreciating ruble boosted the value of their exports.

The Micex Index climbed 0.4 percent to 1,507.10 by the close in Moscow. The dollar-denominated RTS Index also added 0.4 percent to 1,004.13 after slumping to the lowest close since August 2009 on Nov. 14. OAO Novatek, the nation’s second-biggest natural gas producer, climbed 0.9 percent, while Brent dropped 1.3 percent to $78.38. OAO GMK Norilsk Nickel increased 1.6 percent.

While crude’s slide has hurt earnings prospects of Russia’s energy companies, the weaker ruble boosts their proceeds in local-currency terms. The ruble depreciated 0.3 percent to 47.2970 versus the dollar. European Union governments agreed to blacklist more eastern Ukrainian separatists while holding off on further economic sanctions on the Kremlin for fomenting rebellion in Ukraine.

“The story of a weakening ruble helping exporters’ performance is still popular,” Vladimir Miklashevsky, an economist at Danske Bank A/S in Helsinki, said by e-mail. “The market is not expecting sectoral sanctions today from the European Union, just personal ones.”

The ruble’s decline today extends the currency’s year-to-date drop to 31 percent, the worst performance among its peers.

Stock Valuations

The Micex is valued at 4.9 times estimated earnings, the cheapest among 21 developing countries tracked by Bloomberg. The MSCI Emerging Markets Index has a multiple of 10.9. Russia U.S.- traded exchange traded funds had about $31 million of inflows last week, according to data compiled by Bloomberg.

United Co. Rusal, the world’s largest aluminum producer, jumped as much as 7.9 percent before closing 0.3 percent higher at 326 rubles, the highest level since September 2011. The stock has soared 242 percent this year, the steepest gain on the Micex. Last week, Rusal reported its strongest results since the fourth quarter of 2011 as prices and premiums increased.

“Rusal continues to climb, it’s the best equity in the Russian universe right now,” Vadim Bit-Avragim, who helps oversee about $4 billion at Kapital Asset Management LLC in Moscow, said by e-mail. The stock is rising on “the weak ruble, aluminum growth and earnings increase,” he said.

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