Jpmorgan Russian Securit... Share Discussion Threads

[elmfield] 15/12/2014 19:55

Very true,

[loganair] 15/12/2014 19:52

“There is panic in local markets driven by the inaction of the central bank,” said Benoit Anne, head of emerging markets at Société; Générale.

"The time to buy is when there's blood in the streets," not quite there as only 'Panic' but we are getting there.

It’s early yet, Investors would do well to Batten Down the Hatches and proceed with caution on signs that the current crisis could get far worse before it gets better.

Keep an eye on the rouble exchange rate, price of crude oil, official Russian responses, and further geopolitical rumblings for signs of further danger.

In the meantime, investors would as usual be well-advised to keep focused on the long term– equity investing is a marathon, not a sprint.”

[loganair] 15/12/2014 19:43

Rouble tumbles on fears for Russian economy - Jack Farchy in Moscow and Elaine Moore in London:

The rouble tumbled more than 10 per cent in its biggest fall since 1998 as the implications of the fall in oil prices for the country’s energy-dependent economy triggered a rout across Russian markets.

In the bleakest official forecast yet from Moscow, the Russian central bank warned that the country could see a 4.5 per cent to 4.7 per cent contraction in GDP next year if oil prices remained at $60 a barrel.

The combination of a sharp drop in the price of oil, western sanctions and paralysing uncertainty over the economic outlook have triggered a collapse in the rouble in the past month, which hit fresh lows of 64.45 against the dollar and 81.35 to the euro on Monday.

So far this year, it has lost half its value against the dollar, making it the world’s worst-performing major currency, ahead of the Ukrainian hryvnia.

Traders said the central bank had intervened several times during Monday trading but had failed to halt the slide in the rouble for more than a few minutes on each occasion.

“There is panic in local markets driven by the inaction of the central bank,” said Benoit Anne, head of emerging markets at Société; Générale. “Russia may not be on the brink of financial crisis but it is close to losing its investment-grade status.”

The sell-off swept across asset classes, with the shares of Sberbank, Russia’s largest bank, dropping 6.3 per cent, and Rosneft, the state oil giant, falling 4.4 per cent. In dollar terms, Russia’s Micex equity benchmark has fallen more than 26 per cent so far in December — on track to be the biggest monthly drop since October 2008.

In bond markets, the yield of the government’s international dollar-denominated bond leapt up more than half a percentage point to 7.22 per cent — above the equivalent yields for Rwanda, the Ivory Coast and Peru.

Dubbing it “Red Monday”, Timothy Ash, emerging markets strategist at Standard Bank in London, said the rout was a demonstration of investors’ lack of confidence in the Russian economy. “It is not just about oil, it is about sanctions, geopolitical risk and . . . the lack of policy action by the Russian authorities,” he said.

In Moscow, the currency collapse evoked memories of the economic turmoil of the 1990s, as a few Russian shopkeepers gave up trying to keep pace with the falls in the rouble and returned to the practice of marking prices in “conditional units” — a code for dollars.

They were swiftly brought into line. Alexei Nemeryuk, head of trade and services at the Moscow mayor’s office, told news agency Interfax on Monday that marking prices in anything other than roubles was illegal. “Apparently, retailers are too lazy to rewrite their price tags. But this is a few isolated cases,” he said.

The central bank on Monday forecast that capital outflow from Russia would total $120bn in 2015, nearly matching the $134bn estimated to leave the country this year. It also predicted outflows of $75bn in 2016 and $55bn in 2017.

Russian companies remain largely shut out of global capital markets as a result of sanctions imposed by western countries and face a looming credit crunch as they need to refinance their debt. Rosneft, for example, last week raised Rbs625bn from local banks ahead of a foreign bond payment due at the end of the week.

Data from JPMorgan shows that, on average, Russia’s hard-currency corporate bond yields have increased from 8 per cent at the start of the month to about 11 per cent.

“The situation in Ukraine and resulting sanctions have led investors to question how exactly Russian corporates will be able to refinance their debts without access to their usual investor base,” said Yannik Zufferey, head of the Swiss fixed-income team at Lombard Odier Investment Managers.

[loganair] 15/12/2014 19:01

Neil Barnett, the Centre for Policy Studies, suggests that Saudi Arabia is just as interested in undermining the Russian economy as it is in deterring future investment of shale in the US.

Russia’s continuing support for Iran and the Assad regime in Syria brings it into direct conflict with Saudi interests: hence, argues Barnett, Saudi has increased production, the oil price is today around $60 a barrel and the Russian economy is in danger of imminent collapse. The lower oil price therefore serves a far wider Saudi interest than purely the deterrence of further investment in US shale.

Neil Barnett comments: “Saudi policy can best be described as a rope with several strands. Since Saudi has modest military power (not to be confused with vast military spending), its influence on oil prices is its best means of shaping the world. At this point, low prices serve Saudi strategic interests in many ways:

Reining in Russia, whose support for the Assad regime and Iran brings it into direct conflict with Saudi interests.

Putting pressure on Iran during nuclear negotiations.

Using joint economic action against Russia to rebuild the strategic partnership with the US, which the Saudis fear could be undermined by a rapprochement between Washington and Tehran.

Racing to lock in Asian market share through long-term supply contracts.

Deterring investment in alternative energy and unconventional oil and gas (shale), thereby shoring up the market for Saudi oil in future decades”.

[loganair] 15/12/2014 17:31

Russia is the market’s whipping boy right now. Since the start of the year, the ruble has lost nearly half its value. On Monday alone, it dropped to a fresh record low above 64 against the dollar despite Russian central-bank intervention.

There has been massive capital flight, its biggest export — oil — has plummeted and continues to be under pressure, and Western sanctions are biting.

But at least one weight of the falling ruble may not be as bad as it seems.

Rolling over the dollar denominated debt has become an increasingly painful headache for Russia’s companies, faced with reduced access to global capital markets because of Western sanctions, and following those precipitous declines in the ruble. To meet the steady repayment schedule, companies have continued to stock up on the U.S. currency, but have been faced with an increasingly high cost for each dollar.

“If you have currency debts, you must be wondering how you are going to pay them off now,” said Timothy Ash at Standard Bank Monday, as the ruble weakened below 60 per dollar for the first time in history.

But there might be some positive news in this grim outlook.

Central bank data, which suggest that the combined redemptions add up to about $22.7 billion in December, followed by similar deadlines in the first months of next year, could overestimate the real debt level, according to analysts and government officials. They say the real amount is closer to 60% of the headline figure. The central bank declined to comment.

Official data suggest about $40 billion of dollar denominated debt needs to be rolled over by Russian entities in the first half of 2015, and $77 billion in the full year, Oleg Kouzmin, Russia economist at Renaissance Capital, suggests that the figure is likely to be closer to $24 billion and $46 billion respectively. Renaissance estimates December’s redemptions for corporates at about $14 billion.

Why the difference? Well, it’s because official data don’t factor in Russian financing done through offshore vehicles. Take, for example, a scheme in which a Russian entity puts money into a subsidiary in Cyprus which provides credit back to Russia, or low-risk transactions within multinationals or between parent companies and subsidiaries, according to Mr. Kouzmin.

“On our estimates, around 40-45% of total Russian external debt could be attributed to these types of transactions, so should not be repayed due to sanctions,” he said.

According to a high-ranking state official, no more than a half of Russia’s corporate foreign debt is due for payment in dollars. That would equate to about $77 billion in the first half of 2015 About a quarter of the total sum is denominated in rubles, while another quarter is a debt to affiliated companies, mostly Russian subsidiaries debt to the parent companies.

What’s more, the central bank could deploy its substantial dollar reserves to support companies. This happens when the central banks sells dollar in a direct market intervention to provide support for the market, which is cashed in by the private sector. Russia’s Economy Minister Alexei Ulyukayev said in a recent interview that Russia is able to pay off all of its foreign debt in a year if needed.

Central bank reserves were $373.66 billion on December 1. And even though the amount has been falling fast as the central bank has sought to support the ruble, the level of reserves according the official central bank data suggest that Russia is sitting on sufficient cash to face the upcoming deadlines.

“There will be spillover effects from corporates dollar funding needs to Russia’s sovereign bonds,” said Benoit Anne, head of emerging markets strategy at Societe Generale. “But I would say the brunt of the effect has already registered this year. Most corporates started from very cash-rich positions. While the situation is probably severe in some cases, I don’t want to over-dramatize [the risks].”

[loganair] 15/12/2014 17:26

Oil hovering around the 3,800 roubles/bbl mark.

[loganair] 13/12/2014 12:52

US is OK with India engaging Russia, but...

The United States has said it has no problem with India's engagement with Russia, but cautioned that it was not the right time to have trade deals with Moscow because of a series of international sanctions against it.

"It does not mean that India should not engage with Russia," a senior State Department official said when asked about the official US statement in the last few days that this is not the time to do business with Russia.

"It (not doing business with Russia) just means that countries around the world do not move forward with same kind of economic relationship which they have done in the past given that sanctions that are put in place by a number of countries," the official said, referring to the US and EU sanctions against Russia over Ukraine crisis.

"Does this means that the kind of deals that India has done (with Russia during the just concluded visit of President Vladimir Putin) should not have done?" the official was asked.

"I would not say that. I understand that there are a range of countries that have relationship with Russia including India," the official said acknowledging the history of strong India-Russia relationship.

It is a complicated world, the official said.

"Our relationship with India is incredibly important to us. We have an important economic relationship. You can have a range of discussions behind the scene diplomatically, privately, which you do not necessarily say publicly," the official said.

State Department Spokesperson Jen Psaki told reporters "India remains an important partner. Obviously, our economic relationship is a big part of what we continue to work on."

"I'd remind you India doesn't support the actions of Russia and the actions -- their intervention into Ukraine. They've (India) been pretty outspoken about that as well," Psaki said.

The message coming from Prime Minister Narendra Modi is that India will not forget its old friends.

"Modi's message seems to be that, even as a growing India with global ambitions expands its horizons to new partners, it’s not going to forget old friends," it said.

"The Indian leader also may be signaling Washington -- which to Indian thinking has run hot and cold on India since relations first swung upward under George W Bush -- that the US shouldn't expect an exclusive relationship.

The Washington Post said when Modi was still a regional Indian politician, Russia welcomed him three times on visits, while the US denied him a visa.

[loganair] 12/12/2014 15:48

Noticed how there was such a fanfare from the British media when Cameron went over to China and signed just $3bln or $4bln worth of deals where as this year a lone Russia has signed the following deals with China, $400bln to supply them with gas and a second deal worth $300bln for a second pipe line, then a further $100bln to supply China with fresh water from Siberia and now $100bln worth of deals with India.

Wow we! Cameron has signed less then $10bln worth of deals with China and India where as Russia has signed nearly $1 trillion worth of deals with the same two countries.

[loganair] 12/12/2014 15:48

Since the annexation of Crimea, there has been much discussion of the increasingly close relationship between Russia and China. In May, Russia agreed to a $400 billion deal to build pipelines supplying gas to China through the so-called eastern route. Then, in November, Moscow and Beijing signed another agreement to supply gas from western Siberia to China through the so-called western route. The fear is that China could undermine the impact of Western sanctions by “backfilling” – in particular, by providing Russia with an alternative market for its energy exports. Since the Ukraine crisis began, China and Russia have also discussed creating an alternative to SWIFT, the messaging service used by banks.

There has, however, been comparatively little discussion so far of the relationship between Russia and India, even though it is in some ways as important as the one between Russia and China. It certainly has a longer history, dating back to the Cold War when the two countries were de facto allies.

Yesterday, Narendra Modi and Vladimir Putin publicly reaffirmed the longstanding bond between India and Russia – even as the West continues to seek to isolate Russia in response to the annexation of Crimea and destabilisation of eastern Ukraine. At an annual bilateral summit in New Delhi, Modi and Putin signed a series of big deals: the state-owned Russian company Rosatom will build 12 nuclear reactors in India, each of the new nuclear reactors will cost $3 billion apiece; Rosneft agreed to a 10-year, fixed-price contract to provide oil to India; and the two countries will co-operate on the production of 400 Ka-226 military helicopters, worth $3 billion to Russia which India will be at liberty to export these helicopters to third countries.

The deals are worth $40 billion in nuclear energy, $50 billion in crude oil and gas and $10 billion in a host of other sectors, including defense, fertilizers, space, and diamonds.

The meeting between Modi and Putin illustrated the strength of the relationship between India and Russia – and its potential to undermine the impact of Western sanctions against Russia.

[loganair] 12/12/2014 15:42

Looking for value in Russia:

When William Shakespeare wrote the words ‘when sorrows come, they come not single spies, but in battalions’, he could well have been writing about Russia’s present predicament.

With a 40 per cent slide in oil prices this year, a battered rouble, economic sanctions and expectations for its economic growth in 2015 being just 0.8 per cent, investors are wondering whether Russia’s current misfortunes represent a buying opportunity or a portent of worse to come.

Viktor Broczko, senior investment manager at London-based Advance Emerging Capital, thinks if the Ukrainian issue started to de-escalate, value players could be tempted back into Russian equities.

Although a large number of investment houses still predict oil prices will return to roughly $90 (£57.35) in 2015, Mr Broczko says it is notoriously difficult to predict prices correctly.

“If oil prices were to sink further, then even if there is a positive resolution to the Ukrainian issue, the Russian market will probably disappoint,” he says.

“If oil prices stabilise or recover and the political climate improves [with sanctions eased], then the Russian market could do very well.

“We think at current valuations a lot of the bad news has been priced in and there is a good chance the market will recover to some extent from current levels in 2015.”

But Nathan Griffiths, an emerging markets equities manager at ING Investment Management, is negative on Russia. He says sanctions will have a substantial impact on investment levels in the country.

He explains: “Lending from foreign banks has come to a complete standstill, while the local banks are not particularly well capitalised. Capital outflows from the country have been dramatic and foreign direct investment will be negligible. The collapse in the oil price significantly reinforces these trends.”

With nominal wages flat, he says this will depress Russian consumers’ purchasing power, while higher rates and capital outflows will lead to a sharp fall in investment.

Mr Griffiths also predicts a significant recession in 2015, although he says the impact of the currency collapse will be delayed so that it will be some months before it is felt.

“The country really needs the oil price to rally sharply from here and we suspect this will not be forthcoming,” he predicts.

“If there are no changes in direction politically, then the stockmarket will continue to struggle. Valuations appear very low, but Russia has high operational gearing and so a weak economy will be felt.”

But Robin Geffen, manager of the Neptune Russia and Greater Russia fund, makes the point that following the central bank’s move to allow the rouble to float freely, the direct impact of the oil price on government finances has been greatly reduced.

“The weaker rouble can offset the lower oil price, allowing the budget to balance with lower oil prices,” he claims.

“In October, the 10 per cent fall in oil and the 8 per cent depreciation of the rouble meant that monthly fuel revenues were very close to the average of 2014.”

The question now is whether Russian equities are an opportunity or a value trap.

Mr Broczko believes there is still value in Russian equities due to many companies posting good financial results, especially in the export sectors that are benefiting from rouble weakness.

Nicholas Mason, an emerging market equities fund manager at Invesco Perpetual, also sees compelling valuation opportunities, such as exporters and domestic food retailers. “Companies that are likely to benefit from rouble weakness and dollar strength are not restricted to the oil industry,” he says.

“In particular, I favour companies such as fertiliser producer Phosagro, gas producer Novatek and steelmaker MMK.”

But Thomas Wilson, a Schroders emerging markets equities fund manager, is underweight Russia in spite of the cheap valuations.

He says the pace of change and the multiple risks relating to crude oil prices, currency, the macroeconomic outlook and government policies make it too early to buy.

Mr Griffiths also thinks Russia is a value trap, especially if it stays involved in Ukraine as economic sanctions imposed by the west would remain. But if substantial internal reforms were to materialise, he believes the market could see a reprieve.

In terms of accessing Russia, Mr Broczko recommends buying either an actively managed, Russia-focused closed-end fund, or a Russian exchange-traded fund, whereas Mr Wilson favours investing in exporting companies that benefit from rouble weakness.

Mr Griffiths says in 2015, investors should consider the secondary round effects of the dramatic moves seen in oil and the currency in 2014.

“We suspect some of this year’s winners – particularly the steel stocks – will struggle as investment dries up, but there are a few pockets of high-quality, Russia-originated companies that are structurally attractive and not exposed to domestic issues, such as within IT services,” he claims.

Anna Stupnytska, global economist at Fidelity, suggests playing the oil and gas theme outside Russia via countries such as Thailand, India, South Korea, Turkey and central European countries, which stand to benefit from lower oil prices because of the amount they import.

As for active versus passive, there is general consensus that active strategies are strongly preferable to passive.

Mr Griffiths says: “Even if the Russian market rallies, the difference between the best and worst [stocks] will be significant and this will not be captured in a passive approach.”

[loganair] 12/12/2014 13:36

The Eurasian Economic Union of Russia, Belarus and Kazakhstan will begin working from January 1, 2015, and Kyrgyzstan is planning to join. The union is open for other neighbours and partners, Lavrov said.

Russia views the project as part of processes in Europe where integration is based first of all on structures of the EU and the Asia-Pacific region, which has become a locomotive of the world’s economic development and has many promising integration and other associations, he said.

“As the first step to harmonize such processes, we have proposed to begin a dialogue to create a free trade zone between the EU and the Eurasian Economic Union,” the minister said.

[woodcutter] 12/12/2014 13:29

A further point of view, if i may, the oil price is currently been driven by market speculators and their computer models and doesn't reflect the real world requirements, at some point in the next month or so it will revert back to the real world and that may well be a time to consider an entry point for JRS, a Russia 2015 recession will already be priced in.

Woody

[woodcutter] 12/12/2014 13:22

logan some interesting stuff.

It's too early to say if this is the bottom for JRS. It might look cheap but Russian government intervention in the private sector and possible corruption are still concerns for the investor.

I'm not in the "we're all doomed" camp though. My own view is it's best to trade it by TA and soon enough there'll be a turn around and at that point we could well see quite a swift move up. Yes the Russian index and JRS are cheap and history has a habit of repeating itself and there's always an overeaction, it's just timing the entry that requires a little skill.

If your interested in reading more on the dominance of the $dollar and the advantages the US has historically had from petrodollars you should read:

Exorbitant Privilidge by Barry Eichengreen.

The US has had it's standard of living paid for by the rest of the world and the newer economies know that, have the potential to change it and have no intentions of letting it continue indefinately. It'll be a slow burner but with time the BRICS will have their pound of flesh, aimho.

Woody

[loganair] 12/12/2014 10:55

The oil price still holding above 3,600 roubles/bbl as it has done over the past 2 years which is good for the Russian state budget and will keep it in surplus.

Basically the natural resources companies sell most of their production in $, however pay their tax, bills and staff in roubles.

Rosstat reaffirmed its preliminary estimate that the economy grew 0.7%YoY in 3Q14 slightly slower than the 0.8% YoY growth in 2Q14. The economy grew 0.8% YoY in 9M14. Nominal GDP volume reached RUB18.7 tln in 3Q14 and RUB52.4 tln in 9M14.

[loganair] 12/12/2014 10:53

The oil price still holding above 3,600 roubles/bbl as it has done over the past 2 years which is good for the Russian state budget and will keep it in surplus.

Basically the natural resources companies sell most of their production in $, however pay their tax, bills and staff in roubles.

Rosstat reaffirmed its preliminary estimate that the economy grew 0.7%YoY in 3Q14 slightly slower than the 0.8% YoY growth in 2Q14. The economy grew 0.8% YoY in 9M14. Nominal GDP volume reached RUB18.7 tln in 3Q14 and RUB52.4 tln in 9M14.

[dumbo4] 12/12/2014 09:34

Thanks loganair for all that interesting info.I like the idea of the Oil/Gold set up.Putin and Karimov (Uzbekistan) met last week and there may have been some discussion on the eventual fate of the Oxus mine,its expropriation case shortly to get final judgement from Uncitral.Even if Oxus win, they'll never go back, so that very substantial resource will be up for (Russian) grabs.
Am buying back a few more JRS today after selling at 4.80 in June. Big Moves. GLA

[loganair] 11/12/2014 21:04

Russia’s Unfazed by Falling Crude Oil Prices By: Marin Katusa:

Oil is not quite as powerful a weapon against modern-day Russia as one might think.

By arguing that the slump in oil prices will finish off Russia just like it did the Soviet Union, Ambrose Evans-Pritchard, writing in the Daily Telegraph, is forgetting how far Russia has come since those dark days.

It is true that the USSR couldn’t cope with falling oil revenues and that Saudi Arabia is credited with helping to break up the former empire by dramatically increasing oil production from 2 million to 10 million barrels per day in 1985.

And sanctions could make it harder for Russian firms to access Western know-how, and ultimately affect Russia’s oil output.

But that’s only if they drag on for years—which is doubtful, given the price the EU is already paying. A cut in global oil supply—and stronger global growth—will likely rebalance the oil market in the meantime.

A measure of Russia’s improved prospects is that the population is growing again for the first time since 1992. In fact, sanctions notwithstanding, Russia’s finances look pretty stable for now.

Russia has only about $678 billion in foreign debt, which it’s been vigorously paying down from the high of $732 billion reached at the end of 2013. (The US debt to foreigners has passed $6 trillion, and it’s growing.) It’s running a record-high budget surplus and a positive balance of payments. And it’s circumventing the dollar through trade deals. Even after spending $60 billion propping up companies starved of dollar liquidity, Russia has nearly $375 billion of foreign reserves.

Although GDP growth has slowed from 2012’s torrid 4.25% pace, it’s still projected to come in at 1%, no worse than 2013.

Furious about being locked out of SWIFT—the Society for Worldwide Interbank Financial Telecommunication, which helps facilitate international financial transactions—Putin has also ordered the Russian central bank to proceed with building its own national payment settlement system as an alternative.

Then there’s “Project Double Eagle,” which will enable trade partners to price oil in gold. That will allow users to move away from the dollar (and the euro), and conduct their business in something physical and more substantial than fiat money—and Russia’s fellow BRICS nations (Brazil, India, China and South Africa) are cheering it on.

So, perhaps there’s method in Putin’s madness. Russia has not only substantially increased gold production but is stockpiling the stuff, doubling its reserves between 2008 and 2014.

It’s true that the country’s budget was based on oil prices of $96 per barrel. With oil sinking below $70, that hurts for certain. But Russia will survive. It will do some belt-tightening. And it gets a boost from the falling ruble—which is down 25% against the dollar just since the end of September—because that helps to offset losses from cheaper oil.

Russian oil companies earn dollars abroad for their exports, but spend rubles domestically. That means that their extraction budgets remain unaffected and, additionally, it ensures that government tax receipts won’t drop precipitously. Production actually rose to 10.6 million barrels per day in September, close to the highest monthly figure since the collapse of the Soviet Union. Russia’s 8 million barrels of daily export account for 15% of the total oil moving in world markets.

Ironically, Obama’s sanctions could have worse consequences for the US. If Russia ramps up production in order to raise revenues, that will lead to an even bigger fall in oil prices. And one of the primary victims will be US shale production. US fracking operations—which are more costly than conventional Russian (or Saudi) drilling—begin to get uneconomical below $70 per barrel. If the price drops to $60, many US unconventional wells will have to shut down and imports will rise once again.

Thus, the slide in oil prices threatens American energy independence and emboldens rather than weakens Russia.

Meanwhile, Russia forges ahead with exploration and infrastructure development. Putin just inked a 25-year oil deal with China that includes the construction of a brand new 3,000-mile pipeline. And he’s sending fleets of nuclear-powered icebreakers into the Arctic to stake out more reserves, along with troops to protect them.

Quietly, Russia has been ramping up natural gas exploration and production in Nigeria, Egypt, Mozambique, and Algeria. By 2015, Russia will control nearly half of Africa’s production.

Already, Russia has its hands on 47% of the world’s primary production of uranium, and through acquisition it’s picked up mines in Australia, Canada, Kazakhstan, South Africa, and Tanzania.

This is important because the world is consuming far more uranium than is mined out of the ground. We’ve been depleting stockpiles for years.

In the US for example, the estimated needs of nuclear power plants between now and 2021 come in at around 275 million pounds of uranium.

While Americans are counting the few dollars they’ll save on gasoline now and spend on gifts this Christmas, Putin is counting all the billions he’ll make when oil rebounds.

Russia may or may not be losing the current battle. But no matter what Evans-Pritchard may think, Putin has no intention of losing the war—in fact, he’s the only one who really understands what the ultimate prize for winning it is.

Dollars as a percent of foreign reserves have declined from 55% in 1999 to 32% today, and should reach 18% by 2019.

Putin’s not going to spare any effort to come out on top, and the smart money isn’t betting against him. This would not mark the first time he has been wounded and come back stronger as Putin is, to profit from this slump in oil prices.

[loganair] 11/12/2014 13:27

Sales increase 33% YoY. Magnit (MGNT LI – Under Review) (JRS Largest Investment) published a strong trading update for November yesterday. Revenue growth decelerated to 33.2% YoY to RUB66.8 bln ($1.5 bln) from 36.1% in October. Revenue growth at convenience stores slowed to 29% YoY to RUB50.3 bln ($1.1 bln) from 33% in October. Sales at hypermarkets rose 31% YoY to RUB12.1 bln ($263 mln) and in the Magnit family segment 145% YoY to RUB2.6 bln ($56 mln). Revenue growth in the hardware segment reached 74% YoY to RUB1.6 bln ($41 mln).

[envirovision] 10/12/2014 23:56

The ecb will hand it over. They have a bottomless account for this sort of thing and if it appears it wont be repaid they will simply delete the account and pretend it never existed. Its only money and this is one of a handful of global factories where they make the suff!

[loganair] 10/12/2014 21:03

IMF says Ukraine will be bankrupt ‘within weeks’ and needs $15 billion more for war against eastern Ukraine; EU threatens Russia with more sanctions if Russia lets Ukraine go bankrupt; EU will lose billions on Ukraine if Russia won’t bail them out.

The EU is locked in an assymetrical confrontation with Russia: it is unwilling to use military force; it has no agreement to offer Ukraine an EU membership perspective; no way to stop Russian gas purchases without provoking a new economic crisis in Europe; and no Russia-type propaganda machine.

“When Germany talks tough, it usually means it is preparing to act soft”, the Lithuanian contact said.

The IMF has so far paid out $8.2 billion of a $17 billion package to the Ukraine to cover the period until 2016, while the EU has committed €1.6bn ($2bn).

But EU officials believe it needs another $15 billion to stay in the black - an amount equal to the bloc’s entire budget for the six states in its eastern neighbourhood programme for the next seven years.

[loganair] 10/12/2014 12:00

All Russian assets continue to fluctuate in line with the global oil price. Extreme moves are quite possible in these circumstances. As Brent futures rose more than 1% yesterday, the mood in Moscow became more sanguine. As a result, the RTS index closed down just 1.5%, after having gapped down 3% at the open due to a sharp sell off on the Chinese market. This morning, however, the oil price is again falling, while the stock selloff in Asia is picking up speed. Europe is having its own issues with Greece at the forefront again, as a political crisis as a result of a potential change of government to a leftist party is feared. This has created a fairly negative backdrop for the opening of the trading session in Moscow. Expectations are growing that Russia’s Central Bank will raise interest rates further when it meets on Thursday. This will add volatility to the Russian financial markets as the holiday season approaches.

[greenpastures2] 09/12/2014 22:40

Thanks for posting the information loganair. A time to wait and see at the moment.