Russian stocks fall on Moody’s downgrade to junk, weak Brent

MOSCOW, Feb 24 (PRIME) -- Russian stocks fell on Tuesday hit by Moody’s downgrade of the country to a junk level that spurred capital outflow and due to the Brent price fall, analysts said.

The MICEX fell 1.15% to 1,772.16 and the RTS decreased 2.39% to 888.69.

“The junk rating will promote further capital outflow from the country, increase borrowing costs and will pave the way for a lower investment attractiveness of Russian assets,” Andrei Dirgin, head of Alfa-Forex research department, said.

The Brent price fall to below U.S. $59 per barrel was another blow for the Russian stock market, the analyst said.

Andrei Rozhkov, analyst at Metropol, said that the ruble’s fall to below 63 against the dollar will provoke mixed dynamics where exporting companies are likely to grow and companies that focus on the national market are likely to fall.

Banks that the government believes to be systemically important also fell on Moody’s downgrade, Dirgin said.

Russian top bank Sberbank fell 1.40% to 73.3 rubles on the downgrade, while state-run giant VTB decreased 3.14% to 0.06451 rubles.

Mechel, debt-ridden metals exporter included on the list of companies which will receive state aid, rose 12.5% to 61.99 rubles after it said it is preparing documents for the aid.

Natalya Samoilova, head of Golden Hills-Kapital research department, said that Russian stocks may grow on Wednesday in the wake of news on some stabilization in Ukraine and if the Brent price rebounds.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-1.40	73.30	8.559
Gazprom	-1.91	154.99	4.443
Lukoil	+0.37	3001.00	2.095
Surgutneftegas pref	-2.22	39.46	1.571
Magnit	-0.92	11.687	1.484

(61.7235 rubles – U.S. $1)

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