Russia

alarming fears the U.S. stock market participants about a possible rise in interest rates for business loans and rising oil prices could slow economic recovery, have led to a small correction of the major U.S. stock indices. These Beige Book have reason to believe a possible stabilization of the economic situation and a growing business activity in several regions that supported the action against the energy sector in the next cycle of rising prices for black gold to 71 dollars per barrel mark Crude Light. Nevertheless, the stock has continued to track the U.S. to remain in the consolidation of the border continues to hold 200 day moving average.

The Russian market has continued to remain within the lateral trend and factors which could lead it to the movement with the exception of oil prices, yet. However, the consolidation and reduction of volatility in the near future could lead to short-term increase in activity. In favor of this scenario and the emerging figure said symmetrical triangle or Vympel the index of MICEX, as an indication of uncertainty in the market and waiting players. Proximity to the point of exit from this situation increases the pressure on the participants, which is reflected in the decreasing trading volume. However, future direction of prices after the exit is likely to form the background to the news the U.S. economy expected in the next two trading sessions, only one of whom find the domestic stock market due to the upcoming long weekend. For this reason, the market reaction could take place with the delay in moving to the beginning of next week.

Europe

Markets European shares rose on Wednesday as the paper the energy sector went up in price after the oil and bank shares went up on the background of the news that U.S. financial companies will soon be able to repay debts to the state. Oil prices now exceed $ 71 a barrel on the background of these American Petroleum Institute (API) that the stocks of black gold in the United States declined last week, more than expected. Shares of oil company Total, ENI, BP and StatoilHydro increased by 2,0-2,6 percent. The Ministry of Finance allowed the United States 10 largest banks in the country to repay loans amounting to $ 68 billion received as of state in the midst of a credit krizisa.Vernuv loans purchased by the state and its preferred shares, banks are free from the constraints imposed by the Government on the remuneration of top managers, dividend payments and operations on purchases of shares.

Asia

Restoring interest in the commodity asset growth resulted in the Asian markets during the current session. Rio Tinto Group has 19% of sales in China grew by 5.5%, due to speculative expectations of rising prices for metals. Nippon Steel Corp. grew by 5.7% in Tokyo to bid on the background information that the company restart some production facilities. China Petroleum Chemical Corp - rose to bid at 3.2% because of information that one of the units the company expects increase in profit.

United States

U.S. stock market fell on Wednesday due to concerns about the negative impact of rising interest rates on investment companies and private consumption, but was able to play part of the losses by the end of the session and complete the day above intraday minima. The drop in the market accelerated after the auction results were announced on the 10-year Treasuries, resulting sale on the market gosobligatsy, which resulted in the yield of bonds for the first time since October, briefly climbed above 4 percent. Later gosobligatsiyam able to recover yield fell to 3.95 percent, and shares also cannon of minima. Yield gosobligatsy is the benchmark for interest rates on many loans, and investors fear that it signals the growing cost of debt capital, which could become an obstacle to economic recovery. Most significantly decreased shares of companies sensitive to changes in interest rates, such as developers and financial corporations. The index of the shares of construction companies dropped 1.5 percent and the index of financial sector - by 1.6 percent.

Closure ADR GDR trading on the western sites were divergent in nature.

Prices are per 1 share

* closing price of a receipt for the United States and European markets to the closing price of shares on the MICEX.

major macroeconomic statistical data suggest that attention to retail sales in May, as well as the number of applications for unemployment benefits during the previous week. The data will be published in 16-30 Moscow time.

MICEX (daily schedule)

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Exactly ten minutes it took the deputies to take the Law № 3459-1 On the protection of property rights of citizens during the withdrawal of the Ukrainian economy from the financial crisis. As a result, bankers have been a moratorium on the removal of collateral and the borrowers - an opportunity not to pay mortgages. Apparently, the people's elected representatives have decided to punish those financiers who have managed over the past few years significantly increase the mortgage portfolio. However, in the opinion of market participants, the law would not only solve the problem of debts, but will also generate new problems. Last call for the president. His signature and decide who to rescue: banks or the public.

Tuk-tuk

During the game in modern salochki children to the phrase: I'm in the house! says: I pledge - and fired squirt out of the house пинком. This is one of the many anecdotes that demonstrate the situation in the domestic mortgage market. In order to prevent a similar situation, in reality, on 21 May this year, 237 people's deputies voted for the social protection of those citizens who permanently reside in the credit apartments. The meaning of the Act is that at the time of financial crisis, banks have no right to dispose of such citizens' housing if they do not pay the monthly installments on the loan. At the same time of the crisis on obscure criteria would ultimately be determined in the Verkhovna Rada. The initiators of the bill were made by three people's deputies: byutovets Anatoly Seminoga, communist Vladimir Danilenko and litvinovets Nicholas Shershun. The authors argue the need for this law to prevent social tension and the unpredictable effects during the financial crisis. The adoption of this bill will lead to greater social protection of Ukrainian citizens and the constitutional right of citizens to housing, - stated in the explanatory note.

Concern over the credit problems of population has become manifest in the walls of the Verkhovna Rada even last fall, after the banks began to outflow of deposits and have problems with repayment. In a set of anti-crisis measures was then included a ban on the raising of interest rates on loans, as well as initiatives to introduce a moratorium on the alienation of immovable property by banks, based in mortgage loans. As a result, the bill was passed on first reading on 23 December last year, 231 parliamentary votes. And exactly five months after some discussion document be adopted as a whole. With the exception of one deputy, the three factions (BYuT, CPU and Lytvyn Bloc) voted yes as a whole. Exception is the owner of one of the largest banks in the country and the same group Finance and Credit Konstantin Zhevago. Perhaps, as his banker, the bill was not for everyone.

All

against

Literally the next day for more than a law signed by President hit all the anger of local financiers. Protesting everything: and representatives of banks with a high proportionof mortgage loan portfolios, and those who have not yet had time to get established. In support of their charges by the National Bank of Ukraine, Association of Ukrainian Banks (AUB), Ukrainian Credit-bank Union (UNSECOORD), the Ukrainian National Mortgage Association, the Association of participants Collection of Ukraine. Expressed their dissatisfaction is not only lazy.

Across the world accepted to act otherwise: to protect the lender, to protect the person who gives money, - said the first deputy head of the National Bank of Ukraine Anatoly Shapovalov, indicating that the regulator intends to recommend to President Viktor Yushchenko vetirovat enacted law. If the President can not fulfill the obligations of public debtors to banks, which adversely affect the liquidity and capitalization of banks, - argue representatives UNSECOORD. The Union emphasizes that the law does not protect the interests of borrowers who are unable to service their mortgages, but it radically increases the number of those who no longer pay for its obligations, referring to the rules adopted. In AUB stressed that the entry into force of the law for banks will mean that the entire portfolio of mortgage loans will be unsecured, which will require an additional reserve in the amount of loans disbursed. And this is more than 100 bln. Own capital of banks as at 1 April 2009 stood at 124.5 bln. Additional formation of reserves would not simply a loss of individual finuchrezhdeny, but in fact would mean full decapitalization the banking system, said AUB.

May 25, People's Deputy of Ukraine, First Deputy Head of Ukrainian Parliament Committee on finance and banking, as well as the head of AUB Board of Stanislav Arzhevitin introduced a draft resolution on lifting solutions HoAM adopting in general the Law on the Protection of property rights of citizens in the output of economy Ukraine from the financial crisis. In its explanatory memorandum bank chief lobbyist in the walls of the Verkhovna Rada said that the adoption of the law in this edition may lead to the complete destabilization of the banks to their artificial bankruptcy and, consequently, to a significant deterioration in the situation of other customers, since a moratorium on the removal of housing could trigger default loans, which in turn will lead to discrimination of bona fide depositors and borrowers finuchrezhdeny.

 

more populism

Experts believe that the law is very populist in nature. After all, most politicians are not addressing the real economic problems and begin to prepare the pre-program a loud accent which is usually the social protection and assistance to the poor. The law is intended to play the political card. The very content of the document is contrary to the economic mechanism, and only confuses the minds of the borrowers' - возмущается Adviser to the Chairman of the Board Ukrgasbank Alexander Okhrimenko. Clearly, the entry into force of the bill as drafted could have an impact on the preferences of electorate in future elections, - agrees with the department director of research of rating agency Credit Rating Olga Shubina. Bankers believe that the adoption of this document, there is a risk that people incorrectly istolkuet it and deliberately refuse to repay loans, referring to the moratorium. In general, bankers believe, the law could undermine the banking sector and economy as a whole enormous damage, which is not comparable with its populist content.

About

ambiguity of the bill say, and lawyers. According to law firm partner, Vasko and Nazarchuk Vadim Vasko, slowly take the said laws and impose a moratorium on the alienation of property of citizens in the form of real estate, our legislators have not determined a civil law content of the term freeze it for this law. The people's deputies failed to take into account the interests ofcreditors for the return of loan funds to citizens, do not take care about the future of investors (such as citizens of Ukraine who have the same equal constitutional rights and freedoms), - said Mr. Click to continue »

domestic business all tuzhe delaying zone. This year, companies will be save as possible and be spud clients in order to deter a catastrophic drop in sales volumes. Nevertheless, the vast majority of managers believe that in the next year the situation will change for the better. These are the results of the study Impact of economic crisis on the Ukrainian company conducted by audit firm Ernst & Young in conjunction with the European Business Association.

Heavylift entered stupor

chief whip of domestic companies in crisis - drop in sales. On this issue indicated 73% of respondents (in a study conducted last month, was attended by representatives of small, medium and large enterprises the main sectors of the economy).

Proof of this fact can serve as data for the fall of retail turnover. At the end of April 2009 this figure had fallen by 8.8% compared to same period last year. And when compared with the average volume of retail turnover in July-November 2008 (22 billion UAH. in a month), then drop to around 19%, - noted the head of information-analytical center Forex Club Nikolay Ivchenko. Top places in the ranking of urgent issues for the business also took a reduction in profitability and cash position (cash). More than anything else as a result of the crisis hurt sales of the enterprises of metallurgy and engineering. The total reduction in the level of expenditure in the Ukrainian business community has also led to a sharp decline in demand for services for businesses, particularly in advertising. A key trend in the first quarter of Ukraine's business community - the adaptation of businesses to work in the new environment after the economic shock: the new exchange rate to the lower sales volumes, - noted economist company Astrum Investment Management Alexei Blinov. Companies MMC, Khimprom, machinery fell largely due to reduced demand for their products in foreign markets. Developers have suffered due to the reduction of mortgage lending and, consequently, reduce the demand for real estate. Reduction in the building industry provoked a decrease in demand for building materials, - supplement colleague analyst IG Socrates Mikhailo Salnikov.

natural consequence of the fall in demand has been a rapid decline in the production of a majority of companies (in this issue drew the attention of 62% of respondents). At a general pessimistic background of relatively good looks, only a small group of companies (15%), increased production capacity. Approximately a quarter of the companies surveyed managed to keep its production volume to pre-crisis levels.

pets crisis

According to expert opinion, cohort lucky, increase, consists mainly of food processing enterprises. Domestic demand for the products of Ukrainian food practically unchanged. After all the food consumers buy under any circumstances. Hryvnia devaluation made an additional factor, which stimulates sales of the industry: imports went up significantly, and many Ukrainians shifted consumption towards domestic goods, - notes Mikhail Salnikov.

brace, most industries crisis has created fertile ground for the work of alcohol and tobacco industries. This year, the production of vodka increased by 40%, cigarettes - 10%. Vpavshie in depression Ukrainians to indulge their addictions.

In part we can say that the stress caused by the crisis, stimulating the consumption of these products. But do not rule out the factor substitution of more expensive imported liquors and tobacco products cheaper imports as analogues, - said Mikhail Salnikov. Click to continue »