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Reports Russia

Russian stock market daily morning report (February 14, 2014, Friday)

February 14, 2014, Friday, 13:50 GMT | 08:50 EST | 18:20 IST | 20:50 SGT
Contributed by Veles Capital

Despite the fact that American indices were reducing at the open at the back of weak stats on retail sale, trade closed in the green zone. As we believed, the market reacted to the stats with reduction in a moment having no strong factors for correction. With the positive trade in Asia at the time of Russian market open, futures for American indices are showing reduction, therefore, we expect the Russian market to open at Thursday close level.

Main events

Russian grids prepared a new variant of the investment program.

According to Kommersant, Russian Grids prepared a new variant of the investment program, according to which funding would be cut 21% to 987 bn RUR with cutting volumes of introduction of new substations and ETL by 7% and 4%. We suppose that reduction of the volume of capital investments with preservation of the fiscal introduction of capacities forms a positive issue.

Diski is to post its operation results for January today.

We expect to see relatively weak numbers on the operation results of Diksi for January, which possibly make a negative impact on the company’s quotes. We assume that in midterm prospect the quotes of the retailer to not obtain any growth drivers.

Moody's, Standard & Poor’s and Fitch confirmed a credit rating of PhosAgro with stable forecast.

Confirmation of the rating by the leading rating agencies was the reasonable result of company’s business sustainability even in terms of bad conjuncture at the fertilizers market.

Within the frames of the offer, Mechel bought 85.1% of market bonds of MB-04 series.

We assume that investors that are ready to take risks might be interested in bonds of 13th and 14th series, which are trading with discount up to 30-35% of the nominal. Buying given notes and placing them for buyback at the offer in September 2015 will deliver yield of 38-39% annually in RUR considering the coupon being paid off.