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. Last Updated: 07/27/2016

Market Maintains Growth

11The Russian share market maintained a robust performance this week, defending the positions gained in earlier weeks of the stock rally that began in mid-March, traders said Friday.

"This week saw slow, steady growth in the market," said Alexander Petaliff, a trader at Creditanstalt-Grant. "I think we have reached new support levels for many stocks."

The Moscow Times Index advanced by 3 percent both in ruble and dollar-adjusted terms to close Friday at 141.11 and 63.81 respectively. Of the 50 issues that make up the Index, 25 gained and 15 lost.

The week's largest gain was posted by Vareganneftegaz, increasing by 29.1 percent to close at $1.42 a share, while the largest loser was Komineft, shedding 19.3 percent to close at $1.11 a share.

Contrary to earlier predictions about possible "overheating," energy issues Surgutneftegaz and Mosenergo continued to post gains after soaring last week.

While Mosenergo gained 2.3 percent to close at 29 cents a share, Surgutneftegaz jumped 11.6 percent, closing at 14 cents per share.

"The Western demand for ADRs is the main reason why the market is stronger," said Petaliff. "Demand persists, so the market will keep growing."

Meanwhile yields on state treasury bills, or GKOs, increased at Wednesday's auction. Annualized yields on six-month GKOs edged upward to 111.98 percent, from 106.19 percent a week ago.

"The market is very weak relative to earlier this year," said Thomas Reed of the Alliance-Menatep investment house. "There is a large overhang of supply."

Among minor factors contributing to the downturn in the market, Reed mentioned a rally in the market for MinFin bonds and, marginally, stocks.

The ruble kept losing ground, ceding 30 points over the week to close Friday at 4,904 to the dollar.