Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

RTS Sinks 3.12% as UES Dives

National power utility Unified Energy Systems knocked the local market down Wednesday as Russian investor support for the stock crumbled, but UES recovered slightly from its 8 percent morning drop.

The benchmark index, the RTS, closed down 3.12 percent at 329.77 on turnover of $15.25 million. The Reuters MICEX index was down 2.09 percent at 1,219.21 on unusually heavy turnover of 4.23 billion rubles ($135 million) at 5:20 p.m.

The Reuters-MICEX basket of liquid stocks on multiple exchanges was off 2.69 percent at 816.14.

"I think we'll probably correct up because people went short today in this big fall," said Alexander Pankov, a trader at CentreInvest Securities. "If the international background is OK tomorrow or the day after, we'll bounce back."

UES closed off 4.97 percent at $0.0784 on the RTS. UES recovered in ruble trading on MICEX to trade down 4.31 percent at 2.445 rubles ($0.077), while London-listed ADRs were down 5.49 percent at $7.83.

Traders said the stock fell on forced selling by a local market player and said it was unlikely that the fall in UES was caused by any fresh news about the utility.

UES has been falling for most of the year as foreign investors have sold out, unwilling to tolerate uncertainty while UES's virtual monopoly on the industry is broken up on government orders.

The share is the most widely held of all Russian issues and often trades as a proxy to the broader market.

Foreign investors are the biggest source of investment on the liquidity-driven Russian stock market and local investors can rarely resist a sell-off by foreigners.

The share is off about 140 percent from its year peak of more than $0.18, reached in January, and is now at lows unseen since early 2001.

UES subsidiary Mosenergo lost 6.25 percent to close at $0.0285.

Other top blue chips down but less hard hit included LUKoil, down 1.99 percent at $15.24, and Yukos, down 3.16 percent at $8.57.