Kyiv-listed stocks demonstrated their third straight week of growth as the country’s latest economic data provided more reasons for investor optimism. Ukraine’s retail sales continued to grow at a solid 6.2% pace in 1H18 and overall industrial output rose by 2.5%, while the machinery sector alone showed a firm 6.6% YoY output increase in the period.
The UX index added 1.9% to close at 1636 points. However, the trading activity was low amid the continued closure of the largest platform, which led to a wider bid/ask spread for most blue chip stocks. The spreads of around 5% somewhat distort the UX index’s performance since the average spread midpoint is larger than the overall index gain. Raiffeisen Bank Aval (BAVL) advanced by 4.7% to 30.00 kopecks ahead of the bank’s 2Q18 earnings report. We forecast that the bank will post 1.80 kopecks of net profit per share for April-June. UkrNafta (UNAF) corrected from its recent upward move, declining by 3.5% to UAH 110 per share. CentrEnergo (CEEN) barely reacted to the company’s disappointing 2Q18 earnings of UAH 0.73 per share. The stock was little-changed at UAH 15.00. DonbasEnergo (DOEN) remained on a growth path climbing 3.4% to UAH 24.00. Earlier this month there was news 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 trading, Ferrexpo (FXPO) was a bright spot for the second week in a row, surging 12% to GBp 194 per share after a solid advance of 8.8% over preceding week. The company is due to report its 1H18 financial results on Thursday (Aug 2). Poultry producer MHP (MHPC) slipped 2.7% to USD 12.50 per share. In Warsaw, Kernel (KER) failed to stay above PLN 50 level, dipping 1.2% to PLN 49.90. Astarta (AST) shed 2.1% to PLN 32.00 after the company unveiled a mixed operating report for 2Q18.
On the currency market, the hryvnia weakened notably by 1.0% against the dollar to end the week at 26.70 UAH/USD, as the traditional early autumn season of hryvnia devaluation appeared to get an early start. The National Bank was forced to intervene on the interbank market with forex sales from its reserves to maintain balance.
POLITICS AND ECONOMICS
- NABU Accuses People’s Front MP in Attack on its Office
- Ukraine’s 1H18 Industrial Output Rise Comes in at 2.5%
STOCKS IN THE NEWS
-CentrEnergo Net Profit Drops 77% to UAH 271mn in 2Q18
full report
Eavex Capital welcomes any questions or comments you may have regarding our research products.
Please contact our office in Kyiv at 380-44-590-5454, or by email:
Alexander Klymchuk, Head of Sales, a.klymchuk@eavex.com.ua
Dmitry Churin, Head of Research, d.churin@eavex.com.ua
