Equity
Ukrainian equities listed in Kyiv finished mixed last week as local traders continued to focus on the government’s compliance with the IMF program, where good news arrived over the weekend about the likelihood of a new loan installment. Although the scheduled USD 1bn tranche has been delayed since December, the IMF completed its recent review and sent Kyiv the final wording of the memorandum. This means that after the document is signed, the money’s arrival will be almost a done deal. Another widely discussed topic was media reports about the likely resignation of National Bank Governor Valeria Gontareva. Although Gontareva’s departure from the NBU had been rumored in previous years, this time we see the probability of resignation as higher amid a feeling that her nearly-3-year tenure has run its course.
The UX index gained 2.6% to close at 956 points, driven by UkrNafta (UNAF), which was a star performer for the second week in a row. The stock jumped 11.3% to UAH 138 after information that the company may legally manage to force the government to compensate it for previously confiscated natural gas, possibly resulting in a settlement of its large outstanding tax debt. In other blue chips, Raiffeisen Bank Aval (BAVL) lost 1.0% to close at 15.75 kopecks while Motor Sich (MSICH) added 3.1% to UAH 2243 per share.
In London, Ferrexpo (FXPO) shed 2.2% to GBp 157 as a correction in iron ore prices seems to becoming more probable, while MHP (MHPC) picked up 3.8% to USD 9.50 per share ahead of the company’s FY16 report due on Mar 15. In Warsaw trading, Kernel (KER) corrected by 2.5% to PLN 77.00 after its quarterly earnings report came up short of expectations, while Astarta (AST) jumped 11.2% to PLN 68.00 after the company hinted that its EBITDA for full-year 2016 increased by 15% YoY.
On the currency market, the hryvnia gave back last week’s gain to slip below 27 UAH/USD. The currency edged down by 0.4% to 27.05 due to fears that the steel production link disruption with the Donbass will lead to lower export revenues for the country. However, there was also positive news for the hryvnia, with the NBU saying it maintained the country’s foreign currency reserves at USD 15.5bn in February.
POLITICS AND ECONOMICS
- Tax Chief Nasirov Arrested, Charged in USD 75mn Corruption Scheme
STOCKS IN THE NEWS
- Court Ruling Lets UkrNafta Apply Confiscated Gas to UAH 12bn Tax Debt
- Kernel’s Oct-Dec EBITDA Slips 10% YoY Despite Strong Operationals
full report
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