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Reports Russia

Russian stock market daily morning report (July 08, 2014, Tuesday)

July 8, 2014, Tuesday, 07:46 GMT | 03:46 EST | 12:16 IST | 14:46 SGT
Contributed by Veles Capital

European and American stock markets closed yesterday in the red zone and the futures for the stock indices are trading in the red zone. The Russian stocks are unlikely to climb under given circumstances, despite the positive, related to suspension of the military action at the East of Ukraine and macroeconomic data from China.

Main events

RusHydro’ HEPS reduced output by 6% for 1H 2014.

Decrease of power energy output by HEPS of RusHydro is initially explained by the all-time high water ration of the rivers in 2013, which allowed building up generation of power even considering general drop of consumption of power in Russia. Considering the possible reduction of output vs the scheduled reduction of output for the year might reach 8.37-10.26%. The worst scenario provides for power output decline leading to downgrade of EBITDA forecast of the company by 15.15 bn RUR.

Norilsk Nickel sells its Australian mines.

The price of the deal is not disclosed. Resulting from the given deal, Norilsk Nickel expects to earn significant profit, mainly at the expense of writing off prior accumulated reserves on environmental liabilities, which are to be totally accepted by the buyer.

Loss of Rosneft caused by fire at Achinskiy refinery might form 1 bn USD.

At the meantime, the refinery has been insured by Sogaz insurance company, and the coverage volume formed 42 bn RUR. Thus, the loss would be covered by insurance payments.