Russian stocks rally as new US Fed’s head pledges continuity

MOSCOW, Feb 12 (PRIME) -- The Russian market rose on Wednesday in a broad rally as investors were inspired by statements of the U.S.’ Federal Reserve new head that the monetary policy of the world’s largest economy will not change abruptly, analysts said.

The MICEX index increased 0.84% to 1,496.03, and the RTS index edged up 0.84% to 1,353.17.

The Russian market grew at the closure pushed by positive background from the U.S.

“Yesterday new Fed’s Chairwoman Janet Yellen delivered a speech at the Congress. She assured the markets that the monetary policy will remain flexible, and asset purchasing will continue, while the purchasing program will be cut, but the rates of the cut will not be increased,” Ivan Fomenko, director of Absolut Bank’s trust management department, said in a note.

The U.S.’ Dow Jones index jumped 1.22% at the previous closure, and the S&P 500 index went up 1.11%.

In the middle of the day, Russian floors were underpinned by a release of China’s thumping trade performance in January proving that the Asian country’s economy is still robust, Fomenko said.

China’s trade balance for January was at U.S. $31.86 billion as compared to market expectations of $23.65 billion. The country’s exports and imports growth turned out to be much better than expected.

National flag carrier Aeroflot Russian Airlines outperformed the market rising 1.64% to 82.02 rubles.

“Aeroflot’s shares are in demand due to a report on growing traffic linked to the Sochi Winter Olympics,” Fomenko said. The games are being held in the Southern resort city from February 7 through February 23.

Magnit grocery chain also rose by 1.94% to 8,409.90 rubles.

“From recent statements, I would say that results of (retailer) Magnit are traditionally strong and may be considered important for the market. The leader of the consumer sector once again outperformed expectations of analysts by showing a rise in sales at 25%,” Mikhail Kuzin, a portfolio manager at Raiffeisen Capital, said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Gazprom	+0.59	148.47	7.091
Sberbank, common	+0.75	96.84	6.837
Lukoil	+0.63	2028.20	1.464
VTB Bank	+2.24	0.0466	1.451
Sberbank, pref	+1.98	80.25	1.403

(34.7964 rubles – U.S. $1)

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