USD 64.0213

+0.25

EUR 70.8524

+0.22

BRENT 62.12

-0.33

AI-92 42.36

+0.01

AI-95 46.16

+0.01

AI-98 51.79

+0.18

Diesel 47.5

+0.05

40

RUSSIA MORNING MARKET NEWS JANUARY 12th

The equity market saw a strong finish on Friday to what was already a buoyant first trading week...

The equity market saw a strong finish on Friday to what was already a buoyant first trading week of the new year. The benchmark RTS Index closed up 1.6% on the day to close just short of 600 ? levels last seen on the eve of Khodorkovsky?s arrest last October. This is the result of the massive rouble liquidity built up in the last several weeks? flight from the dollar seeping into the equity market at last, and despite the persistent uncertainties of the Yukos situation. What is now little more than a trickle ? as reflected in merely average domestic volume on Friday of just over $300 mn (exchange-recorded ADR turnover was similar) ? looks set to build into a rush as local market participants return to the fray in earnest this week.

The strength of Friday?s market can best be gauged by pointing to Yukos? 2.1% gain as the worst performance among leading oil stocks. Another significant detail is that the two NYSE listed wireless stocks were the only blue chip losers (MTS -0.5%, Vimpelcom -0.2%), highlighting the domestic origins of the buying interest. Finally there is good logic to the day?s best performer ? Sberbank (+5.6% to $300), which is the most obvious and immediate beneficiary of the relentless demand for roubles.