Ukrainian equities showed increased volatility last week amid a batch of 2Q16 financial result releases. Uncertainty regarding continuation of the country’s IMF program remained a restraining factor on purchases of Kyiv-listed stocks. IMF spokesman William Murray said the IMF has no precise date of the board review for Ukraine. Officially, Kyiv says it still expects to receive two tranches in the total amount of USD 2.7bn by the end of the year.The UX index finished at 717 points on Friday (Jul 29), a rise of 0.8% for the week. Raiffeisen Aval (BAVL) added the most points to the gauge, gaining 2.6% to 10.63 kopecks after reporting a second-quarter net profit of UAH 773mn. CentrEnergo (CEEN) also had solid financial results in the period but declined 0.5% to UAH 7.70. Motor Sich (MSICH) failed to follow the growth trend, edging down 1.2% to UAH 2011 as the company’s profit of UAH 1.28bn for 1H16 did not impress investors. In economic news, the NBU lowered its main interest rate by 100 bps to 15.50% at its monetary policy meeting on Jul 28. Yields for the government’s UAH-denominated VAT-19s (a benchmark for domestic interest rates) have not reacted to the event yet, standing at bid/ask of 17.20%/16.25%.In London trading, MHP (MHPC) recovered from a mid-week decline, returning to USD 9.20 per share. Ferrexpo (FXPO) demonstrated a solid advance of 18% to GBp 46, which we view as a speculative boost ahead of the company’s financial report for 1H16 due for release on Aug 3. Warsaw-listed Kernel (KER) and Astarta (AST) were both on the rise, adding 0.5% and 3.1% respectively, with the latter reaching the PLN 50 mark. The hryvnia was unchanged again at 24.80 UAH/USD, as the NBU took advantage of its capital control measures to purchase excess supplies of foreign currency on the interbank market, thereby preventing any speculative strengthening of the national currency.
POLITICS AND ECONOMICS
- Trump Backs Moscow on Crimea, Denies Softening RNC Platform on Ukraine
- Gov’t Projects Strong Grain Harvest Above 60mn Tonnes
STOCKS IN THE NEWS
- UkrNafta’s Net Profit Drops 75%YoY to UAH 500mn in 2Q16
- Motor Sich Manages to Raise Net Profit by 76% YoY to UAH 979mn in 2Q16
- CentrEnergo Posts Solid Net Profit of UAH 417mn in 2Q16
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