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Comment of Vladimir Potapov, Global Head of Portfolio Management Business at VTB Capital Investment Management to Bloomberg


Tags: portfolio management

Nov 29, 2012
Russia Stocks Tumble Most in Two Weeks on Oil; Rostelecom Drops

“We’re seeing the global markets falling for the past few days on concerns of the U.S. fiscal cliff risks,” Vladimir Potapov, global head of portfolio management at VTB Capital Asset Management, said in an interview in Moscow today.

Russian stocks dropped for a third day as oil fell after concern U.S. budget talks have made little progress damped appetite for riskier assets. OAO MegaFon, the country’s second-largest mobile operator by users, raised $1.7 billion in an initial public offering of shares.

The Micex Index fell 1 percent to 1,380.94 by the close in Moscow. Telecom shares were the biggest decliners, losing 3.8 percent on average. OAO Rostelecom retreated 5.2 percent, the most in six months, while OAO Mobile TeleSystems, Russia’s largest mobile operator, dropped 2.2 percent.

Oil, Russia’s main revenue earner, tumbled 1.7 percent to $85.68 barrel in New York, a one-week low. U.S. Senate Majority Leader Harry Reid said he was disappointed with the progress made in congressional budget talks over $607 billion in tax increases and spending cuts set to begin in January. MegaFon fell as much as 2.8 percent to $19.45 in London trading after pricing its shares at $20, according to a regulatory filing from the company today.

“We’re seeing the global markets falling for the past few days on concerns of the U.S. fiscal cliff risks,” Vladimir Potapov, global head of portfolio management at VTB Capital Asset Management, said in an interview in Moscow today.

‘Alternative Exposure’
MegaFon’s IPO offers “alternative exposure to the Russian telecoms sector,” spurring investors to move from MTS and VimpelCom, Konstantin Chernyshev, head of research at Russian brokerage UralSib Financial Corp. in Moscow, wrote in an e- mailed note yesterday. UralSib reiterated its hold recommendation on both MTS and VimpelCom.

Oil traded near the lowest in a week after the U.S. Energy Department said stockpiles unexpectedly fell 347,000 barrels to 374.1 million barrels last week.

OAO GMKN Norilsk Nickel gained 1.5 percent to 4,703 rubles, the biggest advancer on the Micex. Russia’s dollar-denominated RTS Index retreated 1.4 percent to 1,397.38.

The Micex trades at 5.1 times estimated earnings after losing 1.5 percent percent this year. That compares with a multiple of 10.2 times for the MSCI Emerging Markets Index, which has added 8 percent. Russian equities have the lowest valuations based on estimated earnings among 21 emerging markets tracked by Bloomberg.

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