Bloomberg News

Russian Stocks Fall Most in Two Months on Urals Crude, Greece

February 21, 2012

Feb. 21 (Bloomberg) -- Russian stocks declined the most in two months as Urals crude retreated from a nine-month high and investors speculated a second bailout for Greece won’t be sufficient to solve the debt crisis.

The 30-stock Micex retreated 1.3 percent to 1,558.42 by 6:45 p.m. in Moscow, the most since Dec. 21. OAO Gazprom, the world’s biggest gas producer, sank 1.2 percent. OAO Lukoil, Russia’s second-largest oil producer, lost 2.3 percent. VTB Group, Russia’s second-biggest bank, fell 1.4 percent. The dollar-denominated RTS Index decreased 1.1 percent to 1,655.35.

Urals crude, Russia’s chief export, fell for the first time in six days, dropping 0.5 percent. European finance ministers awarded 130 billion euros ($173 billion) today in aid to Greece and agreed on a 53.5 percent writedown for investors in the nation’s debt, while analysis by the International Monetary Fund and European officials indicated Greece’s debt may still balloon to 160 percent of its gross domestic product. Europe is Russia’s biggest trading partner.

“Investors looked beyond Greece and understood that this morning’s deal is no way a solution,” Peter Westin, chief strategist at Aton LLC in Moscow, said by phone. “Everybody had been waiting for a decision on Greece, and now when they got it, they are looking for the next milestone.”

The Micex has climbed 11 percent this year and trades at 6.1 times analysts’ earnings estimates for member companies. Brazil’s Bovespa index, which is valued at 10.7 times estimated earnings, has jumped 17 percent, according to data compiled by Bloomberg. The Shanghai Composite Index trades at 9.8 times estimated earnings, and the BSE India Sensitive Index has a ratio of 16.3.

OAO Sberbank, Russia’s biggest lender, fell 0.8 percent, slipping from its strongest level since Aug. 4. United Co. Rusal, the world’s biggest aluminum producer, dropped 4.3 percent.

--Editors: Stephen Kirkland, Peter Brantons

To contact the reporter on this story: Denis Maternovsky in Moscow at dmaternovsky@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


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