06 April 2004 05:49
Stock market corrects down
Mikhail Khodorkovsky said he had not written and had not given his
lawyers an article on the crisis of liberalism in Russia, which was
MOSCOW. April 6 (Interfax) - The Russian stock market corrected down for the first time in a week on Tuesday and
quotes slid 0.6% to 3%, while the benchmark RTS index lost 1.87% to 750.03 points. Two announcements triggered the
correction. First, former Yukos chief
published last week. Second, Sberbank President and Chairman Andrei Kazmin said dividend payments for 2004 would not
be raised and talked about a lower rate of profit growth. Yukos and Sberbank led the market down. On the RTS, prices
fell 3.7% to $14.3 for Yukos and 4.7% to $430 for Sberbank. Prices also dropped 0.6% for Norilsk Nickel, 1.1% for
Lukoil, 2.9% for Rostelecom, 3% for Surgutneftegaz, and 2.1% for Tatneft. Some of the sale funds trickled toward
Tuesday's protected shares and prices climbed 1.3% for Unified Energy System and 1.2% for Mosenergo. Yukos was the
first to react to the announcement from Khodorkovsky, after which a wave of correction passed through the entire market,
Antanta Capital trader Alexander Pankov said. "It is still not clear whether the market will turn down, but it is
obvious that the previous growth was a last effort. UES of Russia and Mosenergo shares might still surge, but this will
probably be the last upward play. Everything is pointing toward to the market gradually preparing for a fall," he
said. The market has long lived in anticipation of a reason for a correction and received one when Khodorkovsky said he
had not written the newspaper article attributed to him, said Alexei Khmelenko of Uniastrum bank. "Share growth
immediately stopped and Russian investors took a wait- and-see attitude, while few foreign investors were left on the
market," he said. "It is still too early to speak of a market turnaround, but everything is leading to that -
prices have climbed considerably of late and monetary liquidity has gone down. If the United States raises interest
rates, as encouraged by the economic situation in the country, liquidity will slump on our market and then we can talk
about a deeper downward correction," Khmelenko said. "There are small speculators left on the market that are
trying to make profits by playing short positions," he added. "I think the market will see a full-scale
correction in May and until then we will try, if not to climb, to at least keep it within a lateral trend at current
price levels," Pankov said. Oil stocks have finally started to react to oil prices, which have recently slid, said
Alexander Baranov, the vice president of Russkie Fondy investment group. "A drop in oil prices, the dollar's
appreciation against other currencies, and a drop for Russia's Eurobonds have encouraged many market participants
to take profits on long positions," he said. Fundamentally speaking, some shares can still show growth (Rostelecom,
Gazprom and Transneft), but the rest have long been overheated, Baranov said. "In the long-term (in 9-12 months),
portfolio investors may show less interest in the oil sector." Trading volume totaled $27.323 million on the RTS
(including $14.604 million in direct deals), and topped 20.6 billion rubles on the MICEX. Gazprom shares on the St.
Petersburg exchange went down 1.1% to 59.7 rubles in volume of 24.264 million shares. The S&P/RUX composite ruble
index fell 1.48% to 882.49. The index in dollars was off 1.58% to 184.3. The MICEX composite dropped 1.48% to 654.71.
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