Market View

February 8, 2012

Equities: Stocks traded in the red for most of the day but rallied towards the close on fresh Greek deal rumors, with the UX inching up by 0.2% in $3.7m volume. MSICH (+2.6%, $1.0m) remained the top performer in terms of both price growth and volume, followed by ALMK (+1.6%; $0.4m) and AVDK (+0.9%; $0.3m). The broader KP-Dragon index also closed higher (+0.5% in $17.8m). WSE-listed Sadovaya Group (+8%, $0.3m) led growth among foreign-listed stocks, whereas LSE-listed FXPO paused, correcting by 2.1% in $4.9m turnover after reports revealed an unimpressive valuation of Xstrata in the merger with Glencore. With all eyes on Greece, where debt and austerity talks are yet to produce an agreement, we expect the market to remain volatile, but a strong opening in Russia and greenish U.S. futures may provide for a slightly higher start to trading locally.

Fixed income: Ukrainian sovereign Eurobonds traded slightly higher yesterday as global sentiment improved. Benchmark Ukraine 20s and 21s gained approx. 0.25pt on the day to close at 86.75/88.0 (10.09%/9.85%) and 88.0/89.5 (10.09%/9.72%). Corporate spread tightened as well, but with very few trades going through. Metinvest 15s moved up to 99.5/101.0 (10.42%/9.87%) and 18s finished at 90.0/91.5 (11.07%/10.71%). There were still buyers in Avangard, pushing the bonds up to 69.0/73.0 (22.79%/20.65%) as sellers remained reluctant.

Daily

NBU reserves decline 1.4% m-o-m to $31.4bn in January Feb 08, 2012
The NBU’s gross international reserves declined in January by $0.4bn (-1.4% m-o-m), to $31.4bn, slowing the pace of decline compared to December’s $0.6bn (-1.9% m-o-m). ...
SPF sells 45% stake in Chernivtsioblenergo, plans to auction 48 regional gas supply companies Feb 08, 2012
Ukraine’s State Property Fund yesterday sold a 45% stake in Chernivtsioblenergo, a small regional electricity distributor, to VS Energy International for UAH 70m ($8.75m). Separately, the SPF plans to start selling stakes in 48 regional gas supplying c ...
Ukraine Strategy Weekly: Local Drivers Move Into Focus Feb 07, 2012
Global markets were in an upbeat mood last week, closing +2.2% w-o-w (MSCI Global) on the back of a few corporate surprises and, more importantly, improving macro data and resulting drops in risk premiums. In terms of data releases, last week’s numerou ...
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Reports

Ukrainian Bonds: Local Developments Spur Activity in Corporate Issues Feb 06, 2012
Ukrainian sovereign bonds remained volatile during the week with the market struggling for direction. Benchmarks Ukraine 20s and 21s gained around 1.0-1.5 points but then saw some selling pressure and came off to 87.75/89.25 (9.89%/9.61%) and 88.5/90.0 ...
Dragon Capital: Ukraine's Inflation Starts 2012 at Nine-Year Low of 3.7% y-o-y Feb 06, 2012
Ukraine’s headline inflation inched up by 0.2% m-o-m in January, in line with December’s record, slowing in y-o-y terms to 3.7% from 4.6% in December. Producer prices fell 0.8% m-o-m, decelerating on a y-o-y basis to 11.8% from 14.2% in December. ...
Dragon Capital: Avangard Rejects Accusatory Media Reports Feb 03, 2012
LSE-listed Avangard, Ukraine’s largest egg producer, and its majority shareholder Oleg Bakhmatyuk today rejected media reports accusing the company of illegally obtaining government subsidies. ...
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Name Close 1d, % 1m, % YTD, %
DAX 6,754.20 (0.16) 12.25 14.51
FTSE100 5,890.26 (0.03) 4.95 5.71
KP-Dragon 3,886.42 0.71 18.76 18.99
MICEX 1,549.49 (0.86) 6.98 10.50
PFTS 581.34 0.20 5.95 8.78
S&P500 1,347.05 0.20 5.18 7.11
UX 1,547.51 0.19 4.69 6.08
ukr_2021 10.09 (0.49) (3.07) (0.30)
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