Russian share prices may go further down today

The weakness of world markets and the closing of US markets for Labor Daytoday are likely to have a downward impact on the Russian stock markettoday. In addition, extremely unfavorable news from RAO Unified EnergySystem of Russia and a poor 2001 financial report from Severstal estimatedin accordance with IAS will add to this negative trend, experts said. The Vedomosti newspaper wrote today that State Duma deputies, whoparticipated in a session of the trilateral conciliatory commission forenergy bills, objected to the idea of dissymmetric structure of property ofthe energy grid after its restructuring and qualified majority vote inmaking decisions about restructuring and supported the idea of RAO UES'100-percent control of the Federal Network Company.All these decisions are negative for minority shareholders of RAO UES, asthey lose the ability to influence the events. "We may better reconsiderthe recommendations about RAO UES' shares," analysts noted.The Severstal steel-maker also published poor financial results for the2001 business year. Its net losses were $466.9m, even though it reportedprofit at $452.7m in 2000. The main reasons for this was an unfavorablemarket situation and increased operating costs. Some losses are so-calledimpairment losses, the operating profit went down from $694.1m to $92m.This year, the situation on the market improved slightly, but there is noreason to count on better financial performance of Severstal: exportmarkets are being closed and the domestic market is overfilled with steel..