BLBG:Russian Stocks Slide to Weekly Low on Oil, Global Growth Concern
Russian stocks dropped to the lowest intraday level in a week as oil and metals tumbled on concern slowing economic growth will weaken demand for commodity producers.
The Micex Index (INDEXCF) sank 1.6 percent to 1,430.35 by 11:09 a.m. in Moscow, its lowest intraday level since Aug. 12. Oil producer OAO Gazprom Neft slipped 0.5 percent. OAO Magnit, Russia’s largest food seller, declined 1.8 percent. VTB Group, the country’s second-biggest lender, lost 3.4 percent. The dollar- denominated RTS Index retreated 1.6 percent to 1,558.27.
Crude for September delivery dropped as much as $2 to $80.38 a barrel in New York. Citigroup Inc. cut its forecasts for expansion in the U.S., while Morgan Stanley lowered targets for stock indexes in Indonesia and Singapore. Regulators from the U.S., South Korea and Sweden said the market turmoil posed further risks to growth, after data yesterday showed American jobless claims rose and a measure of manufacturing contracted.
“Concerns over global economic growth and the European debt situation are rising and are unlikely to recede until the market receives concrete indications of an improvement in the US and European economies,” UralSib Financial Corp. analysts led by Konstantin Chernyshev said in an e-mailed report today.
Citigroup cut its U.S. gross domestic product growth estimate to 1.6 percent in 2011 from 1.7 percent, and lowered its forecast for 2012 to 2.1 percent from 2.7 percent. U.S. initial jobless claims climbed by 9,000 to 408,000 in the week ended Aug. 13, topping the median estimate of economists surveyed by Bloomberg for a rise to 400,000.
The 30-stock Micex’s 3.7 percent retreat yesterday was its steepest slide since Aug. 10. The benchmark index halted trading for more than an hour for “technical reasons,” according to spokesman Nikita Bekasov. The gauge is heading for its fourth consecutive weekly decline.
Nickel, zinc, steel and aluminum all fell on the London Metal Exchange, while copper advanced.
To contact the reporter on this story: Jason Corcoran in Moscow at jcorcoran13@bloomberg.net
To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net
