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Reports Russia

Russian stock market daily evening report (July 07, 2014, Monday)

July 7, 2014, Monday, 17:47 GMT | 12:47 EST | 21:17 IST | 23:47 SGT
Contributed by Veles Capital


Market today. European indices were looking down after number on Germany' industrial production have been posted for May, showing decline of output in the EU' largest state by 1.8% month to month. Futures for the american indices were down following Europe, and trade at NYSE started with a gap down. Bashneft was among the growth leaders at Moscow stock exchange at the back of expectations of the shares getting included to the MSCI Russia index. Shares getting included in the index provides the company with increased demand of its stock as the index funds should be reforming their portfolios according to the other structure of the index and buy shares from the market.

Rostelecom was climbing after the decisions made at the stockholders meeting. Looks like the holders of the company are serious about upping the capitalization of the company. We might soon likely observe some kind of activities directed to upping the capitalization of the company. Rosneft and Aeroflot have underperformed the market after dividends have been cut off.

Market tomorrow. Messages from China, the world's largest importer of oil, coal and metals, indicate that for 2Q the economic growth has accelerated in the given state. Besides, new tax benefits and reserve requirements' cut for some banks should be supportive for investment activities. Given is a positive signal for the Russian enterprises within the oil, metal and coal sectors, which export the most share of their products.

The Russian share were mainly climbing today. The message that Ukrainian military forces do not plan air attacks and using heavy artillery against Donetsk and Lugansk were the key messages that caused growth. We assume that given should lead to the long-waited suspension of military action at the East of Ukraine.


Market today. The week start was calm at the debt market at the back of lack of important events at global grounds. Ruble loans were mainly trading near their former levels. Slight reduction indicated only the segment of BFL, yield grew 1 to 4 bps here. On contrary, Eurobonds showed limited growth. Russia-43 added 100 bps up to 106.7% of the nominal, Russia-23 grew 30 bps to 103.6% of the nominal value.

Market tomorrow. Monday did not bring up any fresh trade ideas, therefore, we expect the debt market to continue moving sideways until new strong signals come from the Western grounds or Ukraine.