Stocks fall as risk appetite shrinks on North Korea nuclear test

MOSCOW, Nov 30 (PRIME) -- Russian stocks contracted on Thursday as investor risk appetite dwindled after North Korean new intercontinental ballistic missile (ICBM) tests, while oil prices remained flat and provided no support, analysts said.

But companies of financial Safmar group that manages assets of the Gutseriyev family bucked the trend -- oil company RussNeft jumped 5.26% to 500.10 rubles, and electronic goods and household appliances retailer M.Video soared 11.12% to 390.60 rubles on a volume, which exceeded that of market bellwethers Sberbank and Gazprom.

Yevgeny Volkov, an analyst at RosEvroBank, said that the increase may have happened due to the need to increase capitalization of the companies on the last day of November, a reporting date. “Both companies have similar liquidity and equal shares in portfolios, this is why their trade volume is about the same,” Volkov said.

The MOEX Russia Index fell 1.10% to 2,100.62 and the RTS decreased 1.15% to 1,131.56.

“The Russian benchmark contracted on falling risk appetite. Moreover, oil prices remained at a relatively low rate during the day, which did not add optimism,” Irina Rogova, an analyst at Forex Club group of companies, said.

Sofya Kirsanova, an analyst at managing company Raiffeisen Capital, said that the background for the Russian market was mixed as the European bourses edged up 0.2–0.9%, but the Asian floors contracted 0.6–1.5%.

“Pressure on the mood of Asian investors was exerted by another ICBM test of North Korea, which prompted a negative reaction of the U.S. administration, including a threat of new sanctions and a call to all countries to increase their economic and diplomatic pressure on North Korea,” Kirsanova said.

Andrei Kochetkov, an analyst at Otkritie Broker, said that national flag carrier Aeroflot lost 3.85% to 152.50 rubles after posting weak financial results. The company said its net profit calculated under International Financial Reporting Standards fell 38% on the year to 27.149 billion rubles in January–September.

Kirsanova also said that oil company Tatneft looked stronger than the market and its preferred shares gained 3.54% to 353.90 rubles after demonstrating a good free cash flow in its financial report, a good factor for future dividends.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-1.69	224.35	10.404
Polyus	-2.73	4912.00	8.415
MMK	-2.79	43.93	8.262
M.Video	+11.12	390.60	6.977
RussNeft	+5.26	500.10	6.813

(58.3311 rubles – U.S. $1)

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