UX index reduces Ukrnafta weight, swaps Zakhidenergo for Kryukiv Wagon

The UX index committee approved changes to the index basket at a meeting yesterday: Ukrnafta’s (UX: UNAF UK) free-float coefficient decreased to 0.5%, implying a cut in its weight in the index basket to 5-6% (vs. 16% as of close on August 31). Zakhidenergo (UX: ZAEN UK) will be excluded and Kryukiv Wagon (UX: KVBZ UK) added. The changes will take effect on September 2. Vitaly Gorovoy: We positively evaluate the changes in light of recent volatility – cutting the weight of Ukrnafta will reduce its pull in the index considerably. Swapping Zakhidenergo for Kryukiv Wagon is another logical step from a liquidity perspective; their respective trading volumes in August were only UAH 1.9 mln vs. UAH 9.2 mln. The index committee will vote on September 1 on the weight of Kryukiv Wagon and other basket members with less than 5% weights, which could potentially impact Alchevsk Iron & Steel (UX: ALMK UK), Avdiivka Coke (UX: AVDK UK), Donbasenergo (UX: DOEN UK), Yenakiieve Steel (UX: ENMZ UK), Stirol (UX: STIR UK), Stakhaniv Wagon (UX: SVGZ UK), Ukrsotsbank (UX: USCB UK), and Yasynivsky Coke (UX: YASK UK).