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Russian stock market daily evening report (October 15, 2012, Monday)

Contributed by Veles Capital

Stocks

Market today. Reduction of the inflation in China was taken by the players as a hint on expansion of opportunities of China’s Peoples Bank on smoothening the credit-monetary policy. Statement of Merkel on the further restructuring of Greece’s debt being impossible and that Athens have to carry on with the strict economic reforms, was also taken as a positive signal by the markets. Trade in the U.S. opened with slight growth, there is some space for winning back the positive report of Citigroup and stats on the retail sale higher than forecasted.

Market tomorrow. The key event in Europe this week will be the summit of European leaders in Brussels, which is expected to give clear measures relating the Spain and Greek matters. Even the positive surprises in ZEW indices on the Eurozone (against the background of the earlier output positive indices of purchasing managers in the industry) will unlikely become a long-term driver. We expect mild growth of quotes by the results of tomorrow.

Bonds

Market today. Nothing interesting occurred at the domestic market during the day. State notes and corporate issues consolidated at the level reached earlier. As for BFL we can outline 26207 (+25 b.p.), 26206 (-20 b.p.), 26209 (-30 b.p.). In the corporate segment the most significant volumes of trade went on Metalloinvest-5, Gazprom Neft-11, FNC-18. Eurobonds also closed the daytime session with minimal deviations from Friday close. Growth of quotes within 40 b.p. indicated on bonds of VTB, Vimpelcom, VEB. Sovereign curve added in price about 10-15 b.p. (-1-3 b.p. on the yield).

Market tomorrow. Generally the news background remains positive which supports demand of risky assets. However the investors expect comments on Greece and Spain, which might be made in course of the Euro summit late this week, so for now strong price variations are unlikely possible.

News briefly

Russia – In 1H 2012 the IAS net profit of MOESK lost 8%. Company

China – annual adding of CPI in September formed 1.9 % comparing to 2% in August. (Interfax)

USA – retail sale in September grew 1.1%, growth by 0.8% was expected. (Interfax)