Russian stocks fall as ruble drops, EU likely to extend sanctions

MOSCOW, Jan 29 (PRIME) -- Russian stocks fell on Thursday on the ruble weakening and expectations that the E.U. sanctions will be prolonged, although the decrease was partially offset by rising oil prices, analysts said.

The MICEX fell 0.49% to 1,639.65 and the RTS decreased 2.34% to 747.45.

The ruble weakening, which put Russian stocks under pressure, was caused by the strengthening U.S. dollar on strong unemployment statistics, but also “because the E.U. foreign ministers decided to extend the sanctions by six months,” Sergei Filchenkov, analyst at Metropol, said.

The ruble fall was partially compensated by the Brent price increase to around U.S. $49 per barrel in the wake of U.S. Fed’s Open Market Committee’s decision to keep its rates low that will stimulate the U.S. economic growth, and, consequently, supports demand for oil, Timur Nigmatullin, analyst at Finam, said.

Mechel which is to be put on the list of companies that will receive state support in 2015–2016 was the growth leader and soared 45.75% to 31.7 rubles.

Polymetal rose 1.70% to 619.5 rubles on strong financial results for September–December 2014 and on plans to postpone copper ore concentrate production at the Varvarinskoye deposit that may increase interim dividends for 2015, Sofia Kirsanova, analyst at Raiffeisen Capital, said.

Magnit rebounded 3.43% to 10,550 rubles after its fall on weak financial results.

Lenta fell 3.72% to 388 rubles on the ruble devaluation despite strong financial results for September–December 2014, including a 34.5% revenues growth for 2014.

Gazprom fell 1.83% to 145 rubles after publishing weak financial results under International Financial Reporting Standards for January–September 2014.

Uralkali fell 3.42% to 175 rubles although it was found not guilty of a 2014 flood at its mine by the Russian environmental and technological watchdog.

Below are the MICEX’ five most active stocks on Thursday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-0.21	60.50	9.118
Gazprom	-1.83	145.00	4.913
Lukoil	-0.70	2845.20	3.770
Norilsk Nickel	-0.73	11450.00	2.933
VTB	-1.01	0.06650	2.900

(67.1506 rubles – U.S. $1)

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