Displaying items by tag: Russia

Monday, 23 August 2010 07:04

Bushehr reactor loaded with fuel rods

Engineers inspect nuclear facility at Brushehr, Iran

Iranian television showed live pictures of Iran's nuclear energy head Ali Akbar Salehi and Russia's government nuclear corporation chief Sergei Kiriyenko watching a nuclear fuel rod assembly being loaded into the controversial, Russian-built nuclear plant in the southern city of Bushehr this weekend. The official launch Saturday comes more than 35 years after the plant was first planned.

Published in Power & Utilities

Monday, 23 August 2010 06:56

Emaciation More Likely Than Emancipation

Monday is the international day for the remembrance of the slave trade and its abolition. But, while human slavery has been substantially reduced since President Lincoln’s proclamation in 1862, most global equity markets and developing economy currencies remain very firmly enslaved to the trend in the US economy and the direction of Wall Street. The domestic story, especially in economies like Russia that are so dependent on commodity exports, is only of secondary importance. If the recent deterioration in the US growth trend continues then equity markets elsewhere are more likely to suffer from further emaciation than to achieve emancipation.

Published in Uralsib Investor Watch

Friday, 20 August 2010 15:06

New shoots of civil society sprouting

By Patrick Armstrong

Civil Society. One of the things I try to keep an eye on is the growth of civil society – which I define as people doing things for themselves and not waiting for instructions from the top. There isn’t a lot in Russia, but there is some. This summer’s plague of wildfires has brought about a flowering volunteers helping out those affected by these local catastrophes. The effort is made possible and glued together by the New Media. This piece discusses what is happening and here is one of the websites tying people together and helping organise the volunteer effort.

Published in Patrick Armstrong's Russia SitRep

Friday, 20 August 2010 06:26

Price Twitching

By Chris Weafer

Markets, which had become optimistic about earnings and valuation growth prospects on the back of increased corporate activity recently, received something of an epiphany yesterday. But, it was less to do with a vision of St. Paul on the road to Damascus and more to do with a growing number of Americans on the road to the nearest unemployment office. The worse than expected weekly jobless claims report again raises the fear that the U.S. economy is slowing.

Published in Chris Weafer's Investor Notes

Thursday, 19 August 2010 12:56

Regions Limiting Food Exports

By Paul Goble

In what one analyst describes as “the rebirth of the supply-based regional separatism” Russia experienced in the 1990s, the leaders of some Russian regions are again limiting the dispatch of grains and other agricultural products beyond their borders in order to ensure that the residents of their regions will not suffer food shortages.

Published in Regions

Thursday, 19 August 2010 11:27

Kamaz forecasts

Russian truck maker Kamaz has said it expects the domestic truck market to grow by 16.6 percent next year excluding a state sponsored scrappage scheme to incentivise buyers. "We expect that the total market will be about 60,000 units in 2010," marketing director Ashot Arutyunyan told journalists on Thursday. "In 2011 we expect the market will be about 70,000 units excluding scrappage."

Published in Automotive

Thursday, 19 August 2010 11:13

Heatwave declared over

"Today is the last hot day in Moscow," said Roman Vilfand, head of Russia's meteorological service, quoted by Reuters on Wednesday.

Published in Business Watch

Thursday, 19 August 2010 08:05

Drug trafficking key issue at Russia's Afghan summit

Increased economic cooperation, counter-terrorism and drug trafficking were the issues predominating the four-party summit of Russia, Afghanistan, Pakistan and Tajikistan which concluded yesterday in Sochi. Russian President Dmitry Medvedev hosted President of Afghanistan Hamid Karzai, President of Pakistan Asif Ali Zardari, and President of Tajikistan Emomali Rahmon.

Published in Law & Human Rights

Thursday, 19 August 2010 07:13

Corporate Optimism

Asia’s equity markets are trading better today on the back of optimistic corporate news and following a net gain in US markets.The Nikkei is up 1.0% while both the Shanghai Composite and the Sensex are 1.2% higher. That should allow Moscow’s bourse to also open higher this morning with metals and mining stocks and the banks likely to lead.

Asia's developong market currencies are also trading better as investor risk appetite improves and that, plus the prospect of inflation targeting in Russia (see comment below), should also help the ruble to move higher today. The dollar-euro rate is almost unchanged from yesterday's level at $1.2816. Gold continues to edge higher as some nervous investors add more insurance to their portfolios. Gold last traded at $1.231.8 per ounce.

The price of oil is also following that small move higher seen in other asset prices, albeit the WTI discount is still in place and having a disproportionately negative effect on oil related assets. WTI for September settlement is at $75.48 p/bbl (up from yesterday’s mid session price of $74.41 p/bbl) while Brent last traded at $76.40 p/bbl.

Investors, although worried about the strength of economic recovery are now more focused on the already announced M&A activity and the possibility of further events. The move to an aggressive bid by BHP for Potash Corp came news has been followed with the news that GM is planning a $16-$20 bln IPO. Both are interpreted as strong evidence of confidence about future earnings growth in corporate boardrooms. There is a negligible chance of takeover activity in Russia and investor appetite for IPOs is still a long way from allowing any sizeable issues. But, Russian equity valuations are taking their lead from the international markets and any gains in the US on the back of M&A activity, will be amplified in the Russian stock market.

The Russian potash companies are not going to be involved in any contested bids but higher valuations are justified because the government will have no choice to significantly increase spending support for agriculture and to start it almost immediately. Amongst the other stocks to continue focusing on; the macro report for July, issued yesterday, showed continuing good growth in the retail sector and a near 7% increase in real wages over the same month last year (see comment below). That augers very well for the consumer orientated sectors, including automakers, the mass-housing market, mobile operators and banks in addition to the retailers. The banks may also benefit if increasing inflation pressures leads to inflation targeting and a stronger ruble later this year.

In the US today, several economic reports that usually have an impact on investor sentiment are scheduled for release. These include the weekly initial jobless claims update, the Philadelphia Fed general business conditions survey and the Leading Indictor. That latter report is expected to be positive (+0.1%) after several months of negative readings.

The July monthly macro indictors for the Russian economy were published yesterday and show that recovery remains on track. The numbers are particularly positive for the consumer sectors with real wage growth at 6.8% year on year and the value of retail sales up 6.6% over the same month last year. The unemployment rate did surprise on the upside, coming in at 7.0% from 6.8% in June. That was at least partially linked to the unusually hot weather in July, albeit the full effects on the economy of the extreme weather and drought will not become clear until the August and September data. It is simply far too early to speculate about the effect on GDP and industrial production growth or the effect on retail sales.

It is, however, a reasonable assumption that inflation will be higher as food prices, in particular, rise. Last week’s inflation growth was 0.2%, and almost twice the weekly rate of the past several months. The year to date growth rate is 5.1% which means that, unless the inflation rate is checked, the full year growth rate in course for +8.5%. Our full year forecast is for a full year growth rate of +7.5%. Inflation control is the most important priority for government because, apart from aiding economic recovery, a low inflation rate allows the Central Bank to keep the current benchmark rate at 7.75%. Affordable borrowing rates for mortgages, consumer goods and small businesses is an important part of the government’s strategy for economic growth in election year 2011. Hence, if we do see inflation pressures rising in the food sector, the government may respond with pressure to keep price growth in other areas, e.g. regulated tariffs and fuel prices, as low as possible. It may also lead to inflation targeting using the ruble exchange rate. Our year-end target for the ruble-dollar is 28.2.

Although investors lack the conviction to push equity markets higher over the short-term, they are equally reluctant to sell. That was evident in most bourses again yesterday. The S&P Composite in the US was off 0.1% when Moscow closed and finished 0.3% better at the close. A fairly non-descript session in Russian equities and the ruble yesterday, reflecting an equally wasteful day in international markets. The RTS close down 0.4%, at 1,458.4, and MICEX lost 0.3% to end at 1,386.8. The ruble was almost flat for the day by the close of the MICEX trading session. It ended at 30.40 against the dollar and at 39.1327 against the euro. The potash names were amongst the few winners on MICEX, led with a 5.1% gain in Uralkali. MRSK Holdings was a relatively big loser, ending down 4.1%, as speculating trading bets unwound after MSCI made no changes to the composition of Russia benchmark indices.

In the London GDR market, the IOB index ended with a 0.1% loss for a very dull session. Unlike the Moscow investors, GDR investors decided to book profits in Uralkali. It closed down 1.6% at $24.1. Steel names saw some follow-on buying from Tuesday’s strong session. Evraz led modest gains with a rise of 2.0% to $26.51. Global Trans ended down 2.5% after the July economy report showed only a 1.1% year on year increase in rail cargo volumes. That report showed a 6.6% year on year gain in retail sales and that helped Magnit and X Five Group to rally 2.0% and 1.2% respectively. In the US ADR market, Mechel also added to Tuesday’s gains with a rise of 1.2%. Vimpelcom recovered from early session weakness, caused by reports of a bid for an Italian telecoms company, to end the day up 0.1%.

Chris Weafer is the Chief Strategist at UralSib financial group

Published in Chris Weafer's Investor Notes

Wednesday, 18 August 2010 12:26

Cement production back to growth

For the first time since the beginning of the economic recession, cement production in Russia boasted a positive growth rate in H1 2010. During the first six months Russian cement plants produced 21.4 million tonnes of cement, 10.9% more than during the equivalent period of 2009 (19.35 million tonnes), according to the Rosstat data. However, the Russian cement industry has not yet reached the indicators witnessed before the recession. It is forecast that by the end of 2010 overall cement production in Russia will reach 49 million tonnes, a 10-15% year-on-year increase.
Cement prices in Russia have also increased slightly. At present, in August, one tonne of cement costs about RUB 3,000 -3,500 (€76-89), with the lowest price of RUB 2,500 (€63) was recorded in February-March 2010.

Published in Construction & Infrastructure

«Start Prev12345678910Next End»

Page 5 of 24