Kyiv-listed stocks rallied last week, although the gains were only enough for USD-based valuations to tread water amid the slippage of the hryvnia. Local traders were pleased by the NBU’s business activity survey, which suggested that Ukraine’s economy is gaining momentum. The report said that business significantly improved it expectations regarding volumes of goods and services production in 2017. A separate source for optimism was an expectation that the US policy toward Ukraine will remain broadly supportive despite the initial jitters following Donald Trump’s election in November. Concerns over the Russia-friendly outlook of likely top US diplomat Rex Tillerson have also eased somewhat, following his comments in line with mainstream Republican party rhetoric in regard to Russia and Ukraine made during his Senate confirmation hearing on Jan 11.
The UX index closed at 825 points on Friday (Jan 13), a gain of 4.0% for the week, which was roughly offset by a similar drop in the value of the hryvnia against the dollar. UkrNafta added the most points to the gauge, advancing 5.6% to UAH 109 per share. Motor Sich (MSICH) had its own reason for growth, after the government prolonged a preferable tax regime for the aviation industry. The stock rose 4.0% to UAH 1922, its highest level since early November.
London-listed Ferrexpo (FXPO) was volatile over the week but finished nearly unchanged at GBp 131, while MHP’s (MHPC) gain of 2.5% brought it back to USD 9.00 per share. In Warsaw trading, Lugansk-based crop grower Agroton (AGT) paused its rally after a 30% leap, slipping back by 2.3% to PLN 5.18. Top liquid name Kernel (KER) jumped 15% to PLN 73.85 after the company reported a 13% YoY increase in its sunflower oil exports in the Oct-Dec quarter.
On the currency front, the hryvnia struggled through a new wave of volatility amid speculation about the arrival date of the next IMF disbursement. The interbank exchange rate ended at 27.70 UAH/USD on Friday (Jan 13), while the cash rate, which tends to front-run the interbank trend, weakened by almost 5% to a 22-month low of 28.80 UAH/USD.
POLITICS AND ECONOMICS
- Muted US Reaction to Document Alleging Trump Collusion with Kremlin
- UkrStat: Full-Year 2016 Inflation Was 14%
STOCKS IN THE NEWS
- Kernel’s Bulk Sunflower Oil Sales Rose 13% YoY in Oct-Dec 2016
- Ferrexpo FY16 Output Slips 4% YoY to 11.2mn Tonnes
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