News
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July 05, 2010
Market Comment
Ukrainian equity markets finished the week on a positive note Friday (June 2). The UX index rose throughout the day to gain 2.83%, though trading volume remained low at UAH 59.6 mln. Machinery stocks set the pace (KVBZ +8.25%, LTPL +8.19%, SVGZ +4.25%), while steel and energy names trailed in hot pursuit (AZST +4.15%, ALMK +3.73%, ENMZ +4.65%, ZAEN +4.09%).
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July 05, 2010
Politics: Ukraine’s Parliament dismisses lawmakers, passes foreign policy bill
Event: Ukraine’s Parliament (Verkhovna Rada) was a hive of activity Friday (July 2) with a couple of high-profile dismissals topping the list of actions. Vice Prime Minister in Charge of Humanitarian Affairs Volodymyr Semyenozhenko was let go, as was Minister of Environmental Protection Viktor Boiko, Unian reported. According to a statement by member of the opposition Olha Bondar, Semyenozhenko’s appointment in March 2010 was in violation of parliamentary procedure, thus resulting in his dismissal.
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July 05, 2010
Macro: Ukraine’s international reserves up
Event: The National Bank of Ukraine continued to purchase excess foreign currency from the market in June. Positive interventions on the interbank totaled $864.6 mln ($1 bln in May, $1.3 bln in April). As a result, the NBU’s international reserves rose by 10.5% M-o-M to $29.5 bln. Additionally, the interbank exchange rate for the hryvnia appreciated slightly to UAH/$7.91.
Impact: The news is neutral to positive for economy as the increase in reserves was announced.
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July 05, 2010
Macro: The IMF to grant new loan to Ukraine
Ukraine will receive a new credit from the IMF with the total amount reaching $14.9 bln for 2.5 years. However, Parliament will need to pass the Tax Code and Budget law by the end of July. Additionally, the NBU should be provided with more autonomy, while the budget deficit in 2010 should be contained within 5.5% of GDP. In 2011, the budget deficit should be reduced further to 3.5% of GDP.
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July 05, 2010
Fixed Income: Kiev to consider Eurobond restructuring
Event: The city of Kiev is contemplating a restructuring of its foreign debt obligations, Head of the Financial Department of the Kiev State Administration Viktor Padalka stated July 2. The respective decree has already been submitted to Kiev City Council. A shortfall in revenues to the special budget fund was reported as the main reason for the problems with foreign debt servicing.
Impact: The news is negative for CITKIE.
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July 05, 2010
Coke: Ukraine decreases coke output by 15.1%
Event: Ukraine’s coke output was down 15.1% M-o-M in June to 1.4 MT. The main contributors to the slump were Alchevsk Coke (-34.6% M-o-M) and Evraz Group’s coke plants, namely Bagliykoks (-37% M-o-M) and Dniprocoke (-39%).
Impact: The news is marginally negative for the coke sector.
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July 05, 2010
Machinery: Azovmash boosts sales 2.2x in 1H2010
Event: Azovmash, a parent holding company for Ukrainian public machinery producers AzovZahalmash (AZGM) and Mariupol Heavy Machinery Plant (MZVM), has increased 1H2010 sales 2.2x Y-o-Y to UAH 2.7 bln ($340 mln). Combined railcar output for the two plants has reached 5,319 freight cars (4,509 tank cars, 770 gondolas and 40 platforms). Azovmash has also reported that its subsidiary AzovElectroStal is at the final stage of installing a Kunkel Wagner steel casting production line.
