Locally traded Ukrainian equities enjoyed substantial gains last week with a dry domestic news flow having no impact on market participant activity. A highly publicized meeting between US President Trump and Russian President Putin on Jul 16 did not produce any public information regarding their positions on the Ukraine issue. However, the Russian side spread a rumor that Trump is considering a Russian proposal that would allow pro-Russian separatist Ukrainian territories to hold referendums to decide their fate. This would mark a significant change from the stated position of the US, which fully backs the Minsk peace process to resolve the conflict.
The UX index advanced by 3.1% to close at 1,606 points despite the continued closure of the main UX trading platform. UkrNafta (UNAF) was the biggest blue chip gainer for the second straight week, adding 6.5% to finish at UAH 115. We suspect that the stock has been rising ahead of the company’s 2Q18 earnings report, which could appear at the end of this week. We expect UkrNafta to post net profit of UAH 760mn for 2Q, translating into a whopping earnings per share figure of UAH 14.00. Raiffeisen Bank Aval (BAVL) rose 2.7% to 28.80 kopecks while CentrEnergo (CEEN) was unchanged at UAH 14.80. Low-liquidity UX index component DonbasEnergo (DOEN) gained 4.3% to close at UAH 23.30 after local media reported that the company’s majority stake of 60.8% was acquired by Maxim Yefimov, an MP from the Poroshenko Bloc. The price for the deal has not been disclosed.
In London, Ferrexpo (FXPO) finally rebounded after a protracted selloff, rising 8.8% to GBp 172. Low-liquidity MHP (MHPC) inched down by 0.2% to USD 12.85 despite the company reporting a fairly good operational update for 2Q18. In Warsaw trading, Kernel (KER) added 7.6% to PLN 50.50 after the company unveiled a solid increase in grain sales for the second quarter.
On the currency market, the hryvnia moved down by 0.9% against the dollar for the week to close at 26.45 UAH/USD.
POLITICS AND ECONOMICS
- Putin Proposed Referendum on Donbass Status in Trump Meeting
STOCKS IN THE NEWS
-Kernel Raises Sunflower Oil Sales Volume by 37% YoY in Apr-Jun
-MHP Reports 20% YoY Price Increase for Its Poultry in 2Q18
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