Rus News Journal

Russian and World News

the Equation on a rating
For the first time in history Russia to it the international credit rating of investment level is appropriated. For the Russian private investors it, probably, a good occasion to reconsider structure of the investments.

              on October, 8th the international rating agency Moody ` s has made decision to raise a rating of the Russian sovereign eurobonds and rouble bonds at once on two steps - to investment level Vaa3. it means that now in the Russian securities can put means the largest western investment funds, at which order billions dollars. We will note, that the new rating of Russia concerns a category of the investment is especially important. Only such status also allows to apply for reception of money of the western institutional investors - pension funds and the insurance companies.
the Previous sharp raising of a sovereign rating of Russia has been made by agency Fitch on May, 13th this year, and also on two steps - to level VV +, that corresponds to a rating Ba1 (it on a position more low, than to Vaa3 ) on scale Moody ` s. Then the market practically has not reacted to the given event. Quotations of the Russian papers have not changed almost. The prices on " have a little grown; long eurobonds, but it could occur and without rating increase: constant insignificant instability of prices is peculiar to this market. Besides already next day quotations of the given papers have won back back that, possibly, testifies that speculators have tried to play on positive news. But this initiative has not received support of serious investors.
this time reaction was much more rough. The most liquid eurobonds have grown on three - five percentage points. As a result a spread on profitableness with the American bonds at most long releases it was reduced to 200 - 240 basic points. Rouble bonds have grown on 0,5 - 0,7 percentage points. Plus to that news about rating increase has literally developed the share market. If in first half of day on October, 8th many participants fixed profit of previous days, after 14. 00 when it became known about decision Moody ` s, impetuous growth has begun. The index of RTS which has fallen by this moment on 2 %, following the results of day has shown a gain of 3,15 %, having reached the next historical maximum - 628,98 points. Next morning growth has proceeded - to the middle of day RTS index has overcome a mark 633 points.
and this with the fact that for similar decision Moody ` s waited - many players bought up in advance the Russian actives in hope of increase of their quotations. But, probably, it is all - taki there was a game without special confidence of a successful outcome. After decision-making on increase of a rating speculators simply as from a chain have broken. And their such behaviour deserves the most steadfast attention as correct interpretation of events will allow also to the private Russian investor to earn on the decision of the international rating agency.
really, we will look that, as a matter of fact, has formed a basis for decision Moody ` s. In the agency communique it is told that rating increase reflects strengthening of adherence of the Russian government to a reasonable tax policy and the politician of management of a debt, considerable improvements in debt and liquidity factors, creation of the stabilisation fund, called to smooth possible negative influence of falling of the prices on raw materials, and reduction of political risk in the country .
Differently, the basic risks which are considered by agency, concern ability of the state to pay on external debts. This ability just also is defined by such factors, as a budget condition (that is presence at the government of money) and a condition of the balance of payments (that is presence at the country of enough of hard currency in which, actually, and the external debt is nominated). Plus, naturally, political risks.
from this it is clear, why upwards the prices for the Russian eurobonds sharply have gone. Expecting arrival on this market of large western funds, speculators have started to inflate the prices. Growth in the market of an internal debt and in the share market demands more steadfast analysis as here long-term consequences of decision Moody ` s at least not so are obvious.
really if to speak about a condition of the rouble actives, here defining influence on the market will be rendered by a position of the Ministry of Finance. Certainly, arrival of large western investors on the market of the Russian currency debt will make its less profitable so, many holders of the Russian eurobonds will transmit the money in rouble tools that theoretically should lower and their profitableness.
but at the same time the government thus will appear before a difficult choice. On the one hand, it will have a serious temptation refinansirovat an external debt at the expense of release of euroloans: so far as rates under eurobonds fall why not to replace expensive back issues cheaper new? If such decision is accepted, it means sharp reduction of internal loans as before the power declared intention refinansirovat an external debt at the expense of escalating internal. Within the limits of this scenario the market of an internal debt sharp falling of profitableness and growth of quotations wait; That who trusts in such succession of events, it is necessary to be engaged immediately in buying up of rouble state papers or shares of the PIFS focused on investments in given actives. It makes sense to think and of actions which can rise in price against reduction of prices for tools with the fixed profitableness.
on the other hand, that the government will realise the similar policy, far is not obvious. The matter is that replacement of external loans with the internal has serious plus: it is the insurance from currency risks on a case of sharp falling of the prices for oil and sharp reduction of inflow of currency in the country. So, if the authorities will prefer to be reinsured and expand the program of internal loans, it is better not to twitch especially and easy to wait for new releases of state papers: their profitableness for certain will appear above present market.
PETER RUSHAJLO