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Reports Russia

Russian stock market daily morning report (June 23, 2014, Monday)

June 23, 2014, Monday, 09:27 GMT | 05:27 EST | 13:57 IST | 15:27 SGT
Contributed by Veles Capital

Brent oil futures’s prices grew up to 115.2 USD having exceeded an emotional level of 115 USD. Trade in Europe and Asia was also positive last Friday. Generally, the foreign background is mildly positive for the Russian market. Moreover, no significant news, negative for Russia, came out about Ukraine. Friday after the trade open, Russian indices continued slipping down at the back of the escalation of the situation at the east of Ukraine. After messages came out that funds directed to investing in the Russian shares, have indicates inflow of assets in June, MICEX index won back the morning share of drop. Generally, during the day the trade was flat. Given occurred due to the fact that market participants experiencing difficulties with evaluation of the scales of Russia’s involvement into the political crisis in Ukraine. Before the trade closed, a large selloff went at Moscow market – evidently, many participants preferred to take out their profits before the weekend.

Main events

MMK posted neutral results in line with targets

MMK posted neutral results in line with targets. Sales for 1Q 2014 grew 0.5% qoq to 1.88 bn USD; EBITDA reduced 6% qoq to 294 mn USD. EBITDA margin reduced 1 pps to 15.6% for 1Q 2014. The company expects the financial results to improve in 2Q 2014. Recovery of prices at the domestic market up to the export parity began in March and the major effect of given growth would be seen in the 2Q 2014 results.

DVEUK might become an intermediary in passing on the shares of Inter RAO to Rosneftegas

In case Rosneftegas continues consolidating the shares of Inter RAO, its stake exceeds 30%, which provides for placing an offer to the minority. The price of buyback for such offers normally makes a weighted average market price for the recent 6 months, which currently forms 0.00912 RUR, below the current quotes – 0.0095 RUR. Therefore, the buyback price of the possible offer would not turn into a driver for the company’s quotes.