Kyiv-listed equities finished lower last week amid the strong correction across all global stock markets. In our view, there were no local Ukrainian events that were related to the sell-off in domestic stocks. The UX index’s drop was 2.7% for the week, which left it at 1450 points on Friday (Feb 9). The gauge still has a gain of 6.4% since the start of the year. UkrNafta (UNAF) was the hardest hit blue chip, sliding 13.7% to UAH 106 per share partly due to a notable decline in the benchmark oil price.
Low-liquidity UX index basket member DonbasEnergo (DOEN) fell 10.4% to UAH 16.30 (Eavex Capital has a SELL recommendation for DOEN), while Motor Sich (MSICH) managed a gain of 1.0% to UAH 4360. Raiffeisen Bank Aval (BAVL) added 3.7% to 30.10 kopecks after a preliminary report which indicated that the bank earned 7.27 kopecks per share for FY17. This means that the bank’s potential dividend could be as much as 6.90 kopecks, which would represent a huge dividend yield of 22%.
London-listed MHP (MHPC) was unchanged at USD 14.00 per share, while iron ore producer Ferrexpo (FXPO) dropped by 6.5% to GBp 260 amid broad-based heavy selling on the London Stock Exchange. In Warsaw trading, Ukrainian names were also under pressure, with Kernel (KER) falling 7.1% to PLN 47.00 and Astarta (AST) down by 7.5% to close at PLN 51.80; the company’s announcement that its FY17 sugar production was down 8% YoY to 463,000 tonnes could be blamed for part of the stock’s decline.
On the currency front, the hryvnia again benefited from weakness in the dollar, gaining 3.0% to close at 27.00 UAH/USD. The National Bank reported that the country’s foreign currency reserves stood at USD 18.4bn at the beginning of February. This figure represented a smaller-than-expected decline in the reserves of 2%during January.
POLITICS AND ECONOMICS
- Kyiv Caught in Dual Spats with Hungary and Poland
- Ukraine’s 2018 Foreign Debt Servicing Estimated at USD 3.7bn
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