Market comment

Обзоры рынка 25.06.2013 Mining stocks kept hemorrhaging in trading on Monday, June 24 after Goldman Sachs cut its China growth forecast, but farming equities were on the rebound. The WIG Ukraine Index of Warsaw-traded stocks bounced 2.2%, led by Coal Energy (CLE PW +4.8%), which otherwise suffered an 11.6% drop last week. Grain trader Kernel (KER PW) jumped 4.0% after hitting its lowest price in more than three years on June 21. Nevertheless, it suffered a net loss of 10.6% last week. As the most actively traded stock on the WIG Ukraine Index, it weighed on its results, contributing to the Index’s 7.9% loss for the week. Traders hammered mining firm Ferrexpo (FXPO LN -6.6%), sending it to lowest price in nearly four years. Its shares slid 5.9% last week. Investors kept bottom-fishing for JKX Oil & Gas (JKX LN +5.2%), which has been hovering at nine-and-a-half year lows. The Ukrainian Exchange was closed on Monday, June 24 for a state holiday. The UX Index finished last week at a 1.3% loss. Correspondent accounts at the NBU continued sliding last week to UAH 23-24 bln, compared to UAH 24-26 bln a week before and UAH 26-28 bln in the first week of the month. Decreased liquidity – as well as the nearing of the quarter’s end and another holiday-rich week in Ukraine – led to an increase in money rates by 0.5-1.0 pp by the end of the week to 1.5% overnight, 2-3% for weekly money and 4-5% for monthly lending. The government bonds market remained calm, with the main activity observed in papers maturing within a year. Half-year bonds yielded 8.5%/7.8%, while one-year bonds were available at 11.4%/10.6%. The local currency became more volatile last week, with UAH/USD crossing the 8.160 rate on Wednesday and reaching a week-high of 8.166 on Thursday. On Friday, though, the hryvnia strengthened to 8.155/USD, the level at which it started last week.