18 June 2004 00:00
Putin`s reassurance sparks Moscow surge
ByLine: Paivi Munter
Russian shares soared after a statement by President Vladimir Putin eased bankruptcy fears surrounding Yukos, the
country's biggest oil producer.
The RTS1 index soared 10.1 per cent to 587.1, the biggest one-day gain for the Russian market in 4l years. The index
was helped by a 34.2 per cent surge in Yukos to $8.32, the biggest one-day rise in the stock in more than four
years.
A frenzy of short-covering in Yukos erupted after Mr Putin said the government would do its best to avoid bankruptcy
at the oil company, which is facing $3.4bn in back tax claims.
"Russian authorities, the government and economic authorities are not interested in the bankruptcy of such a
company as Yukos . . . " Mr Putin said. "The government will do its best to prevent the collapse of the
company."
Anton Khmelnitski at Brunswick Asset Management in Moscow, said: "This is an enormous relief."
Mikhail Khodorkovsky, the principal owner of Yukos, is on trial over separate charges of fraud and tax evasion in a
high-profile case thought to stem from a political battle between the oligarch and the government. It has attracted
international attention, raising questions about property rights in Russia, where tax evasion and murky business
practices were commonplace during the 1990s.
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