Norvik Research 29.05.2017

29/05/2017 16:25

Global developments

Global stocks are mixed while markets in the US, UK and China are closed for public holidays. EURUSD is 0.1% higher at 1.119 before Mario Draghi will speak to the European parliament today at 13:00 GMT. Eurostoxx 600 is 0.1% lower. The dollar index is 0.1% lower. Gold prices are slightly up after gaining 1.0% on Friday.

Oil prices are lower amid rising drilling activity. The number of active rotary rigs reported by Baker Hughes increased by 2 to 722. Brent prices are marginally lower today at $52.1/bbl.

Russia and CIS area developments and market colour

The rouble is down 0.2% against the dollar at 56.6. OFZ yields are 2-4 bps lower today. Russia’s and Kazakhstan’s longer term sovereign yields are 0-1 bp lower today.

Corporate news

On Friday, bond prices of Far Eastern Shipping Company spiked on the news that Dubai’s container operator DP World Ltd. is considering taking a stake in FESCO. The global container-terminal operator may take control of at least 20% of the company. The deal could be closed as soon as next month. FESCO’s chairman Ziyavudin Magomedov signed a broader partnership agreement with DP World last year. FESCO’s Eurobond maturing next year with a coupon of 8% rose 4.8% as the news broke. Since mid-2016, the company stopped making coupon payments. Nevertheless, the Eurobond rose from 45.0 to 70.0 at the moment.

Sberbank held annual general shareholders’ meeting last week. Shareholders approved the recommendations of the Supervisory Board for distribution of 2016 net income and payment of dividends of 135.5 billion roubles, which accounts for 6.00 roubles per stock. In 2015, the bank paid out 44.5 billion roubles, or 1.97 roubles per stock. Last year, Sberbank’s net income rose 2.4 times and reached 541.9 billion roubles.

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