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. Last Updated: 07/27/2016

UES Shares Jump 13% On Rumors

Unified Energy Systems preferred shares shot up Friday on unconfirmed rumors of a conversion, but most of Russia's shares closed practically unchanged despite increasing foreign flows, traders said.

The key RTS index closed up 0.16 percent at 169.46 on volumes of $19.78 million. The broader Reuters Russian Composite was up 0.61 percent at 1,371.53.

"UES pref is the paper of the day," said a trader at a Western bank.

The share posted gains of 13.25 percent to $0.0453 after hitting gains of nearly 20 percent in the early afternoon. Martin Diggle, a director at Brunswick UBS Warburg, said the board's announcement last Monday of a 2000 dividend double the 1999 figure injected life into the share.

"They've suddenly started to find a lot of interest," he said. "The board announced a seven percent dividend and they've started to outperform in the last three to four days."

Andrei Kukk of NIKoil also reported a rumor that UES preference shares would be converted to ordinaries.

UES spokesman Andrei Tra-pez-nikov said later in the day neither the executive board nor the board of directors had considered a share conversion.

Diggle said sales of oil blue chips continued in the morning, concentrated in LUKoil and Surgutneftegaz and investors were swapping into Yukos.

Brunswick cut its rating on Surgut to "Buy" from "Strong Buy" on Thursday.

Surgut fell to a low of $0.21 but closed 0.47 percent higher at $0.2135. LUKoil was off 1.59 percent at $9.3 and Yukos was up 1.23 percent at $2.63.

UES ordinaries were up 1.32 percent at $0.1000.