Bloomberg News

Micex Index Falls for Second Day as Growth Concern Offsets Oil

December 28, 2011

Dec. 28 (Bloomberg) -- Russian stocks declined, extending the Micex Index’s annual loss, on concern global economic growth will slow, hurting exports from the largest energy supplier.

The 30-stock Micex fell 0.2 percent to 1,383.38 at 12:55 p.m. in Moscow, pushing this year’s decrease to 18.1 percent. The dollar-measured RTS Index slid 1.1 percent to 1,383.70.

Stocks dipped even as oil, the country’s biggest export, traded near a six-week high after Iran threatened to block crude shipments from the Persian Gulf via the Strait of Hormuz, through which about one-sixth of the world’s oil flows.

OAO Lukoil, the Russian oil company with the biggest overseas production, declined 0.2 percent to 1,650 rubles. OAO Gazprom Neft, the oil arm of the world’s largest gas supplier, dipped 0.1 percent to 141.67 rubles.

There’s “no significant positivity” for Russian stocks today, so markets are following Asia lower, UralSib Capital, a Moscow-based brokerages, said in a research note.

Economic reports today showed Japan’s industrial production dropped and confidence among South Korean manufacturers sank to a 30-month low. U.S. home prices fell more than projected in October even as consumer confidence gained in December to an eight-month high, data showed yesterday.

Earthquake

The MSCI Asia Pacific Index declined 0.7 percent. Standard & Poor’s 500 Index futures retreated 0.3 percent. Copper lost 1.5 percent in London, soybeans slid for the first time in nine days and gold sank to a one-week low. The euro weakened against 12 of its 16 major peers. Treasury 30-year yields slipped one basis point to 3.01 percent.

OAO Mechel, the largest supplier of coal to Russian steelmakers, dropped 1.8 percent to 258.40 rubles, while OAO Raspadskaya, another coal producer, fell 1 percent to 101 rubles.

Russia evacuated some coal mines in Siberia after a magnitude 6.7 earthquake struck the Tuva region, the Emergency Ministry said. Work is resuming and safety checks are continuing, the ministry said. No injuries were reported.

Oil for February delivery was at $101.32 a barrel, down 2 cents, in electronic trading on the New York Mercantile Exchange. It rose $1.66, or 1.7 percent, to $101.34 a barrel yesterday, the highest settlement since Nov. 16.

--With assistance from Shiyin Chen and Wes Goodman in Singapore. Editor: Torrey Clark

To contact the reporter on this story: Brad Cook in Moscow at Bcook7@bloomberg.net

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


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