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Reports Russia

Russian stock market daily morning report (June 17, 2014, Tuesday)

June 17, 2014, Tuesday, 11:19 GMT | 07:19 EST | 15:49 IST | 18:19 SGT
Contributed by Veles Capital

We expect that today the Russian stock market opens within the range of 1 490-1 500 points, but during the day it will not show any single trend and the trade is likely to enter the red zone. We suppose that this week the Russian shares will be supported by high oil prices at the back of the conflict in Iraq. However, the main negative factor for the Russian exchange market is formed by uncertainty between Russia and Ukraine on the gas issue. As for the major events of today, June 17, we might mention the following: the registers of stockholders that are to collect dividends are to be closed in Sberbank, Norilsk Nickel and Novolipetsk metal company. Notes of given companies are trading at Moscow exchange with calculations “T+2” without the dividend component.

Main events

Russian Grids compensate spending at the expense of rising tariffs.

According to the output act of the government, shortfall in income of Russian Grids from change of calculation of cost of technological adding of consumers up to 150kW will be compensated by the grid tariff. We suppose that the given redistribution of income has two sides. First, the company might manage to compensate the entire limit or a share of shortfall in spending. Second, given redistribution might push a share of investors away from investing due to change (extra complications) of forecasting money flows of the company.

IAS net profit of Tatneft grew 43.7% for 1Q 214.

The net profit of Tatneft for 1Q 214 by IAS formed 24.39 bn RUR vs the 16.97 bn RUR for 1Q 213, meaning the estimate outperformed 43.7%. Growth of the financial estimates of the company was provided by growth of oil products selling and ruble growth of products prices resulting from dollar rate rise. At that meantime, the cost of production for 1Q 2014 showed negative dynamics.