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Russian stock market daily evening report (February 26, 2013, Tuesday)

Contributed by Veles Capital

Stocks

Market today. Shares were reducing under pressure of the preliminary results of the election in Italy. Preliminary results indicate that none of the parties gained a significant lead in parliament, which makes forming a coalition government in the state rather complicated.

At MICEX the shares of VTB were among growth leaders today afternoon after the output of the messages that the sovereign fund of Qatar hired UBS to estimate the possible investments in VTB in the volume of 3 bn USD. However, the shares lost in price immediately after information appeared that the fund was asked for a 25% discount vs the market price. Shares of Novatek were climbing due to plans of support to projects of Yamal JV on behalf of the state.

Market tomorrow. Currently there is a more significant event that would hold back the activity of the investors this week ¨C fiscal cliff problem in the U.S. Deadline on the matter of budget cuts is this week March 1, and as we see it, the statement of the head of FED Ben Bernanke at the bank committee of the Senate will be precisely on the given matter.

Forecast of the World Bank that the oil in 2013 reduces to 102 USD per barrel might lead to re©\estimation of the long©\term prospects of the oil sector by the investors toward reduction. That in its turn might make a negative impact on the oil companies shares quotes. Today the shareholders of Synergy consider the matter of buying back a share of stock from the market. In case the positive decision is made and the price is set with premium to current quotes, interest might rise in Synergy. Earlier the notes of company felt bad against the background of the limits on selling alcohol in RF.

After the trade close at MICEX, at 7:00 pm MSK a rather important index of consumers to economy of the U.S. in February, which might make a significant effect on the trade in New York and MICEX tomorrow. Totally we expect that investors will be relatively passive this week while waiting for the fiscal cliff problem to be solved in the U.S. and coalition government to be formed in Italy.

Bonds

Market today. Russian debt market showed firmness against the foreign negative. Ruble debt segment traded mainly near the former values. The long issues of BFL were the only ones under pressure and lost up to 20 bps.

Currency bonds by the end of the session showed mild drop ¨C about 15©\ 30 bps. Sovereign issues grew in price insignificantly against the background of the spreads expansion vs UST. Russia©\42 traded at the level of 115.55% of the nominal (+20 bps), Russia©\22 ¨C 144.4% of the nominal (+4 bps).

Market tomorrow. An important role in forming the dynamics will be played by the statement of Bernanke to the bank committee. In case the head of FED manages to convince investors that the regulator does not plan to cut QE3, than most likely global sentiment improves Wednesday.

News briefly

Gazprom neft plans to adopt a strategy till 2025 this year. Company

Gazprom neft increased oil export by 8% yoy in 2012, oil products ¨C by 12% yoy. Company

World Bank lowered the forecast of Russia¡¯s GDP growth in 2013 to 3.3%. Interfax