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Dec. 20 (Bloomberg) -- Russian stocks fell for a second day as protesters plan further demonstrations this weekend against the parliamentary election results and falling oil prices hurt the energy-led economy.
The 30-stock Micex Index declined 0.7 percent to 1,373.26 by 12:09 p.m. in Moscow. Oil producer OAO Gazprom Neft slid 1.2 percent OAO Sberbank, Russia’s biggest lender, lost 0.6 percent while coal-maker OAO Mechel dropped 1.5 percent. The dollar- denominated RTS Index retreated 0.7 percent to 1,360.81.
Almost 40,000 people have signed-up to protest on Dec. 24 in Central Moscow against alleged ballot-box stuffing in Dec. 4 elections. Urals crude, Russia’s chief export blend, dropped 0.1 percent yesterday to $104.73. Crude for January delivery climbed 30 cents to 94.58 a barrel in New York, paring this month’s decline to 5.5 percent. Stocks have plunged 8.2 percent this month following the nationwide protests.
“Russia is in the doldrums,” Julian Rimmer, a trader of Russian shares at CF Global Trading in London, wrote in e-mailed comments. “Investor attention is fading and the world is watching to see how Russia’s inchoate protest movement fares this weekend.”
Russia’s newly merged Micex-RTS exchange halted equity futures trading on its first day yesterday, sparking concern the Moscow bourse won’t be able to compete with global peers.
Futures expiring in March on the dollar-denominated RTS index stopped trading about 12 minutes into the U.S. session yesterday due to a “technical problem,” Anton Storozh, a technical support specialist at the exchange said by phone from Moscow. Trading resumed 50 minutes before the end of the session, with the contracts sliding 1 percent to 133,350.
The world’s 10th biggest futures market, according to the Futures Industry Association, became part of Russia’s newly combined exchange yesterday after the Micex and RTS united in a bid to lure local companies and investors back to their home market. After halting trading more than 30 times in the second half of 2008, the Micex cut the number of stoppages to once in 2009 and five this year, according to spokesman Nikita Bekasov.
“It’s not a good start,” Luis Saenz, chief executive officer of the U.S. unit of Moscow-based brokerage Otkritie Financial Corp., said by phone from New York. “Investors have been complaining, wondering if this is what they should expect going forward, especially in this environment when there is already so much happening in Russia politically and otherwise.”
Otkritie handles about 38 percent of futures and options trading on the RTS, according to Saenz.
The Micex lost 18 percent this year and trades at 4.7 times estimated earnings, the cheapest valuation among major emerging markets. That compares with 10 times for Brazil’s Bovespa index, 10.6 for the Shanghai Composite Index and 13.7 in the case of the BSE India Sensitive Index, according to data compiled by Bloomberg.
--With assistance from Leon Lazaroff and Halia Pavliva in New York Editors: Ash Kumar, Linda Shen
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