Higher Oil Prices Drive Shares
- By Olga Popova
- Sep. 11 1999 00:00
Shares ended with healthy gains as surging world oil prices and expectations of positive debt news sent the market roaring back to life after weeks of slumber, traders said.
The key RTS1-Interfax index added 2.63 percent to close at 103.84. Volume was an exceptional $20 million. The broader Reuters Russian composite added 2.24 percent to close at 452.84.
The dollar-denominated Moscow Times Index of 50 leading shares rose 1.96 percent to 78.65 on turnover of $20.39 million.
"A certain role may have been played by oil prices as well as by a generally good situation on world markets," said Flemings UCB trader Samit Yakovlev.
Oil prices are now near their highest since February 1997.
Traders said Friday was the first day in weeks some key investors were active the local market, though they remained divided on where most activity came from - local investors, domestic investors or business among traders themselves.
Some traders saw investors invigorated by expectations of progress on restructuring Russian debt.
"[There are] expectations of an announcement next week on restructuring MinFin 3 [bonds] and on a restructuring and maybe partial write-off of London Club debt," said Dan Rapoport, managing director of CentreInvest securities in Moscow.
Investors have said they are optimistic Russia will come up with a good proposal in talks on restructuring Soviet-era London Club debt which will take place Wednesday.
Market activity was the strongest since early July. But traders said despite the market's run Friday its future was still unclear as big Western players remained cautious about the recent bombings in Moscow, the conflict in Dagestan and media reports of Russian financial scandals.
"This just doesn't look like long-term growth," said Olma trader Dmitry Raenko. "Maybe someone among clients decided [after recent losses] it was time to invest in the Russian market."