With a 6% jump in the RTS Index during the past week and a 12.3% boost in the last month it was perhaps not that strange that the market had difficulties taking off yesterday, despite three items of good news: Zhukov as deputy PM, Kudrin staying in the government and positive noises about Vimpelcom. The news about a $1 bn tax claim against Sibneft managed to fully take away any optimism. Although the RTS (which closes at 18.00) was down only 0.4% to 686, MICEX (which closes at 18.45) traded down heavily and Sibneft was down 4% at $3.41, Transneft was down 3.7% at $881, Surgut -2.5% to $0.635 and LUKoil was down only 1.1% at $28.7.
Gazprom went against the stream, with locals finishing 0.2% up at $1.969 and the ADS at $33.8, up 2.2%. Vimpelcom, despite positive vibes regarding the licence problems, was down 2.1% in ADR trading, probably on the back of the Sibneft effect.
The market should open weak today, after a 3-4% fall in yesterday's ADR trading. Sentiment may have been slightly hurt, but the fundamentals have not been.
With Brent spot averaging $31.25/bbl so far this year we seem to be lined up for another good year of oil prices.
Russian Eurobonds were marginally lower yesterday, in line with US Treasuries. The EMBI+ Russia Index lost 0.1% with its spread tightening by 3 bp to 256. GKOs and OFZs were slightly lower yesterday ahead of today's auction at which MinFin is to offer Rb 11 bn worth of OFZs. The corporate and municipal segments were flat and fairly inactive.