Drukāt |

Norvik Research 21.09.2016

21/09/2016 13:20

Global developments

Global equities are rising after BoJ announced modification of its bond-buying program. BoJ refrained from cutting the policy rate deeper into the negative territory while strengthening its control the yield curve. The yen lost 0.2%, Nikkei 225 gained 2.0%, while CSI 300 was up 0.3%.

Japan’s macroeconomic data for August was weaker than expected. Exports declined 9.6% YoY against the forecast of a 4.7% drop, while imports fell 17.3% YoY (against forecast of -16.6%). Machine tool orders declined 8.4% in August after falling 8.4% in July.

The dollar index is flat ahead of today Fed’s policy rate decision. The US 10y yields are flat at 1.69%. S&P futures are 0.4% higher today, while Euro Stoxx is 0.8% higher. Bloomberg commodity index is 0.5% stronger.

Oil prices are rising on positive inventories data. American Petroleum Institute reported that crude oil inventories in the US fell by 7.5 mn bbl (against consensus forecast of a 3 mn bbl build up). Brent prices are up 1.8% at $46.7/bbl. OPEC’s energy minister said that OPEC may turn informal talks into a formal session in a sign of a possible positive outcome of the meeting.

Russia and CIS area developments and market colour

The rouble is 0.4% stronger today to 64.4 against the dollar. OFZ yields are lower 4-12 bp today after widening 9-14 bp in the belly yesterday. Russia and Kazakhstan longer term yields are flat and 2-3 bp tighter respectively today. Ukraine’s longer-dated sovereign yields are little changed with Ukraine 19 yield tightening 7 bp to 7.89%. Azerbaijan-24 and Armenia-25 are 3 bp tighter while Belarus-18 is flat.

Corporate news

Uralkali has completed share buyback program. The program was announced on 18 May, the company bought back 3.35% of its share capital. As a result, free float declined to 5.61% from 8.96% before the start of buyback. We estimate this program cost Uralkali around $280 mn. In our view, the company will buy back the remaining shares from the market, which will continue to weigh on its credit profile.

Severstal will seal off Severnaya coal mine. Operations at the mine were suspended following the accident in February 2016. In 2015, the Severnaya coal mine produced approximately 1.5 million tonnes coking coal concentrate, which is approximately 27% of Vorkutaugol’s overall production of coking coal concentrate in 2015 (5.6 million tonnes). We estimate losses for Severstal on EBITDA level following the closure of mine at $30-40 mn per year (2015 EBITDA of Severstal: $2,048 mn).

For more information on the research, please click here.

Norvik Banka Research
+44 207 259 8854

This report is prepared by Norvik Banka UK Limited, of 46-48 Grosvenor Gardens, London, SW1W 0EB, United Kingdom (hereinafter referred to as the Company) as a marketing communication for information purposes only. Neither the information nor any opinion contained in this report (notwithstanding the source) is intended to be, or should be construed as an offer, a recommendation, an advice or an invitation to make an offer, to buy or sell any financial instrument. Information contained in this report constitutes neither investment nor tax advice and it does not take into account the specific investment objectives, risk appetite and financial situation of anyone who may receive this report. Investors should seek their own advice regarding the appropriateness of investing in any financial instrument discussed in this report and carefully evaluate the risks and eventual losses that are related to the investment services and its compliance with their investment goals.
Investors should note that any income derived from investments in financial instruments may fluctuate and that the price or value of securities and investments may rise or fall. Accordingly, investors may lose their investment or receive back less than originally invested. Past performance and income is not a guide to future performance and income. Foreign currency exchange rates may adversely affect the value, price or income of any security or related investment mentioned in this report. Investing in the Russian or CIS economies and securities involves a high degree of risk and requires appropriate knowledge and experience.
The information contained in this report have been obtained from such public sources what are believed to be reliable, but no representation or warranty is made by the Company with regard to accuracy. Therefore the information contained herein is subject to change without prior notice.
This report should not be viewed as the only source of information, and neither the Company, nor the companies within the NORVIK group and/or any affiliates or employees thereof accept any responsibility or liability whatsoever for any direct or indirect damage arising out of or in any way connected with the use of information contained herein, nor for its authenticity.
This report may not be distributed, copied, reproduced or changed without prior written consent from the Company. Further information, which for the avoidance of doubt cannot be treated as the recommendations and/or advice either, may be obtained from the Company upon request.
This report has not been prepared on the basis of the requirements of regulatory provisions promoting independence of investment research and is not subject to the prohibition from making transactions before disseminating investment research.
Norvik Banka Research is a Trading Name of Norvik Banka UK Ltd, which is Authorised and Regulated by the Financial Conduct Authority, FRN: 681329. Registered in England and Wales with number 08940522. Registered Office: 46/48 Grosvenor Gardens 1st Floor, London, SW1W 0EB.

The information contained in this communication from the sender is confidential. It is intended solely for use by the recipient and others authorized to receive it. If you are not the recipient, you are hereby notified that any disclosure, copying, distribution or taking action in relation of the contents of this information is strictly prohibited and may be unlawful.

This email has been scanned for viruses and malware, and may have been automatically archived by Mimecast Ltd, an innovator in Software as a Service (SaaS) for business. Providing a safer and more useful place for your human generated data. Specializing in; Security, archiving and compliance. To find out more Click Here.

Pēdējās ziņas