Investment grade rating from S&P’s drives Russian stocks higher

MOSCOW, Feb 26 (PRIME) – Russian stocks rose on Monday propelled by an increase of the country’s rating to an investment grade by Standard & Poor's, analysts said.

The MOEX Russia Index rose 0.70% to 2,353.16 and the RTS increased 1.81% to 1,324.62.

“S&P increased Russia’s rating to an investment grade from junk, and now two out of the three major international rating agencies rate Russia at BBB-. It is an obviously positive sign for all Russian assets, but very few people doubted the decision, so the emotional reaction to the event will be priced during just one day,” Vasily Oleinik, an expert at investment company Finam, said.

Vitaly Manzhos, a senior risk manager at investment company Nord Capital, said that the local stock indices also priced in a February 23 increase in oil prices, when the Russian market was closed for a national holiday.

Andrei Kochetkov, an analyst at Otkritie Broker, said that the background for the Russian market was positive during the day as European floors were in the green zone thanks to the February 23 growth of the U.S. market and to a slight increase of futures for the S&P 500 index.

“Shares of producing and technology companies made the major contribution to the rise of the European indices. Of course, the general positive background was supported by the fact that the yield on U.S. 10-year treasuries is not rising, but fell to 2.86% on Monday,” Kochetkov said.

Kochetkov also said that the mood of local traders was positive as they expect positive financial reports of Russian companies later in the week.

Russia’s second largest bank VTB was one of the leaders with shares rising 5.57% to 0.05463 rubles following publication of a robust 2017 report.

The country’s top bank Sberbank rose by 0.89% to 279.97 rubles and Kochetkov said investors expect the bank to publish a positive financial report later in the week, which also supported the shares.

Below are the MOEX Russia Index’ five most active stocks on Monday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	+0.89	279.97	19.104
Magnit	-6.56	4803.00	7.209
VTB	+5.57	0.05463	5.652
Gazprom	+0.71	147.00	5.514
Norilsk Nickel	+4.34	11874.00	4.719

(56.7608 rubles – U.S. $1)

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