Metinvest suspended operations at its two steel rolling mills in Italy due to the COVID-19 pandemic. Ferriera Valsider and Metinvest Trametal will be closed at least until Apr. 3 or longer if the government restrictions are extended. Metinvest estimated production losses at 40 kt.

Ukraine’s current account (C/A) ran a $0.2bn deficit in February, down from a revised $0.7bn surplus in January and bringing the 2M20 surplus to $0.6bn, up from $0.4bn in 2M19. The 12-month trailing C/A gap stood at 0.7% of GDP. Adjusted for last December’s $2.9bn Gazprom inflow, the C/A gap totaled 2.6% of GDP, slightly lower than in 2019.

Fitch Ratings downgraded its long-term foreign currency default rating on DTEK Energy to C from B- and cut DTEK Eurobonds to C with a recovery rating of RR5. The agency cited DTEK’s insufficient liquidity to pay a Eurobond coupon and deteriorating cash flows.

Raiffeisen Bank Aval (BAVL) postponed its AGM, which was provisionally scheduled for April, with a new date to be scheduled within three months following the end of the COVID-19 quarantine.

Ukrainian banks reported combined net profit of UAH 16bn ($652m) in 2M20, +83% y-o-y. Sector CAR stood at 20.1% at end-2M20, +0.5pp YTD.

Ukraine’s direct and guaranteed public debt was virtually flat m-o-m (-$17m) at $83bn in February, rising 6.6% or $5.1bn in y-o-y terms and being equivalent to an est. 52% of GDP, slightly up from 50% in 2019.

LSE-listed JKX Oil & Gas reported 2019 financial results, booking a 10% y-o-y increase in revenues, to $102m, 16% growth in EBITDA, to $42m, and a 46% increase in net income, to $22m. The EBITDA margin rose by 2.3pp y-o-y to 40.8% and net margin was up 5.4pp to 21.8%. Net operating cash flow increased by 5% to $33m, investment cash outflow doubled to $27m, and financing cash outflow rose 17% to $6.4m.

Ukrainian Railway (RAILUA) acting CEO Željko Marček said the company could suffer a net loss of UAH 6-10bn ($0.2-0.4bn at current F/X) in 1H20 due to the national quarantine. The reasons are the suspension of passenger transportation and the need to fully reimburse ticket costs after Mar. 18, and a sharp drop in production and transportation from some industrial customers. The company announced significant cuts to CAPEX and purchases of goods and services.

New countries relaxed their restrictions on importing poultry from Ukraine to a regional (oblast/district) level, including the UAE, Israel, Moldova, Azerbaijan, Armenia, Hong Kong, Kazakhstan, KSA and Kuwait.

Parliament appointed Serhiy Marchenko as the new finance minister, dismissing Ihor Umansky, who barely spent three weeks on the job. Lawmakers also replaced the healthcare minister but failed to fill the vacant post of energy and environment minister as the nomination was reportedly recalled in the last minute.

In a post-midnight vote that capped over four months of debate, the Verkhovna Rada passed a bill on the farmland market at second (final) reading. A total of 259 lawmakers, or 33 above the minimum majority of 226, supported the bill, including 206 from President Volodymyr Zelensky’s Servant of the People party. Despite staunch opposition to land reform from populist opposition parties, which submitted over 4,000 amendments to the bill to extend its debate for months, the legislation finally passed, making Ukraine’s 19-year ban on farmland sales history.

The government submitted a revised 2020 budget draft to parliament yesterday, proposing to triple the deficit target in nominal terms to the equivalent of $10bn or 7.5% of GDP, up from 2.1% of GDP. The Verkhovna Rada failed to support the amendments yesterday, returning the draft to the parliamentary budget committee. PM Denys Shmygal said he expected the Rada to pass the revised budget within 7-8 days.

Parliament passed a second piece of legislation aimed at supporting the economy during the quarantine period.

In a post-midnight vote that capped over four months of debate, the Verkhovna Rada passed a bill on the farmland market at second (final) reading. A total of 259 lawmakers, or 33 above the minimum majority of 226, supported the bill, including 206 from President Volodymyr Zelensky’s Servant of the People party, 23 from ex-president Petro Poroshenko’s European Solidarity, 13 from Svyatoslav Vakarchuk’s Voice, and the remainder supplied by unaligned lawmakers from single-seat constituencies. Despite staunch opposition to land reform from populist opposition parties, which submitted over 4,000 amendments to the bill to extend its debate for months, the legislation finally passed, making Ukraine’s 19-year ban on farmland sales history.

Developments around the IMF-required banking and land reform bills will remain in focus this week.

After near-record drops in most equity markets, last week’s growth was equally comparable with some of other strongest recoveries in history.