Daily Market Monitor: However we see no serious upside potential in the coming days

The rouble bond market remained restrained on Monday following
dollar appreciation against the rouble. Traders simply removed their
bids, while not hurrying to sell off their portfolios, seemingly waiting for
the exchange rate movement to reverse. We believe that current high
price levels leave no upside potential in the coming days, although a
significant downturn is not very likely either. The significant volatility of
the exchange rate could bring a pause in active trading until the situation
resolves. Meanwhile, Gazprom announced a new date for its 5-year Rub
5 bln bond issue – it will take place on February 16 (instead of February
8 as earlier planned).

The Russian Eurobond market remained dormant Monday on
positive speculative sentiment. The Russia’30 spread to benchmarks
contracted 5 bps to 200 bps. However we see no serious upside
potential in the coming days, as the most positive news that had been
expected on the market has already happened (the sovereign rating
upgrade, for example). Meanwhile, Russian borrowers continue
borrowing on the Eurobond market while rates are low: Vimpelcom
came to the market with a $300 mln seven-year issue priced at 8%, while
Sberbank placed an additional $150 mln worth of 10-year bonds at
6.23% to increase the issue value to $1 bln ($850 mln were placed a
day before).