Bloomberg News

Russia Stocks Rise First Day in Five After U.S. Rating Affirmed

November 23, 2011

Nov. 22 (Bloomberg) -- Russian shares rose, lifting the 30- stock Micex Index for the first time in five days after ratings companies affirmed their credit scores for the U.S., easing concern the global slowdown may intensify.

The Micex rose 1.7 percent to 1,414.72 as of 4:11 p.m. in Moscow, paring a 4.8 percent decline yesterday, which was the biggest in seven weeks. OAO Magnitogorsk Iron & Steel, Evraz Plc and OAO Severstal all gained more than 1 percent. The dollar- measured RTS Index gained 1.7 percent to 1,449.68.

Standard & Poor’s and Moody’s Investors Service kept their ratings for sovereign U.S. debt unchanged after Congress’s special debt-reduction committee failed to reach an agreement, setting the stage for $1.2 trillion in automatic spending cuts in the world’s largest economy.

“There is a whole slew of economic data to be released in the U.S. today and tomorrow ahead of the holiday on Thursday, and, effectively, Friday,” said Chris Weafer, chief strategist at Troika Dialog, Russia’s oldest investment bank. “If the numbers are positive, then this will help put some calm back into markets that have become very fearful that political dithering and party fighting on both sides of the Atlantic will leave it too late to fix the problems,” Weafer said in a note.

Crude oil, Russia’s biggest export earner, increased 1.2 percent in New York to $98.09 a barrel for January delivery, halting three days of declines.

Magnitogorsk, Severstal

Magnitogorsk, billionaire Victor Rashnikov’s steelmaker, rose 1.3 percent to 12.71 rubles. The company said earlier today it was considering buying into Flinders Mines Ltd. in Australia. Bigger competitor OAO Severstal, controlled by billionaire Chief Executive Officer Alexey Mordashov, advanced 2.2 percent to 403.30 rubles after Goldman Sachs Group Inc. upgraded the stock to “buy” from “neutral.”

Evraz jumped 1.6 percent to $15.08 in London after Goldman affirmed its “buy” rating on the stock and named it a “top pick.”

OAO GMK Norilsk Nickel, Russia’s largest mining company, rose 2.3 percent to 5,150 rubles.

The Micex has dropped 16 percent so far this year, compared with a fall of 19 percent for Brazil’s Bovespa index and the MSCI Emerging Markets Index’s decline of 21 percent.

--Editors: Alex Nicholson, David Risser

To contact the reporters on this story: Brad Cook in Moscow at bcook7@bloomberg.net; Jack Jordan in Moscow at jjordan22@bloomberg.net

To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net


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