Equity
Ukrainian stocks listed in Kyiv made an impressive recovery from the preceding week’s speculative slump. Besides the technical rebound factor, there was also positive news that the country’s industrial production accelerated in November, giving more grounds to expect a broader economic recovery in 2017. The government is forecasting 3% GDP growth next year. Also, we are pleased to note that the shock nationalization of the country’s largest bank, PrivatBank, has come off quite smoothly, defying the pessimistic scenario of a hard landing for the bank with widespread financial system turmoil.
The UX index gained back 3.0% to close at 785 points on Friday (Dec 23). Raiffeisen Aval (BAVL) advanced 5.6% to 12.70 kopecks thanks to expectations that the nationalization of PrivatBank will bring the bank a spillover windfall of retail and corporate clients. UkrNafta (UNAF) gained 0.5% to UAH 103 on encouraging news for the company that Parliament cut the production tax for oil for 2017. CentrEnergo (CEEN) returned to UAH 10.30 on a 2.7% gain, while London-listed Ferrexpo (FXPO) slipped 3.1% to GBp 134 despite a rally in iron ore prices that saw the benchmark Fe-62% spot price reach USD 80 per tonne. MHP (MHPC) was little-changed near USD 8.72, while in Warsaw trading, Kernel (KER) tumbled 7.5% to PLN 60.50 after the government’s last-minute decision to eliminate the preferential VAT regime for the agro sector in the budget bill.
The hryvnia was untouched by the developments with PrivatBank, ending the week at 26.30 UAH/USD after briefly dropping to 26.50 UAH/USD on Dec 19, the first trading day after the nationalization was announced.
POLITICS AND ECONOMICS
- EU, US Maintain Russia Sanctions Ahead of Trump Inauguration
- PrivatBank Eurobonds Destroyed by Nationalization
- Ukraine’s 2017 Budget Passed with 3% Deficit in All-Night Session
- UkrStat: Industrial Output Growth Accelerated to 3.7% YoY in November
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, [email protected]
Dmitry Churin, Head of Research, [email protected]
