Overbought Russian MICEX to open flat, RTS fall on oil weakness

MOSCOW, Mar 9 (PRIME) -- Russia’s overbought MICEX stock market index will open flat on Wednesday, while the RTS will decline on the back of oil price shakiness as Brent has approached a U.S. $40 level, analysts said.

“A downward correction of the RTS is possible today at the start of trade. Strong growth on the commodities’ market has stopped after a release of an API statement on U.S. oil reserves increase, Brent futures are again trading below U.S. $40 per barrel,” Olma senior analyst Anton Startsev said.

“Technical indicators say that the MICEX is a bit overbought, it can see a correction after a surge in the last few days and can close a gap at the 1,880 notch, which was formed earlier during the growth if the external background deteriorates,” Oleg Shagov, head of investment company Solid’s research department, said.

The MICEX is expected to open at 1,910, the support levels will stand at 1,900 and 1,890 and the resistance levels are expected at 1,920 and 1,930. The index will consolidate after the opening, Vitaly Manzhos, senior analyst at Bank Obrazovanie, said.

Brent is slightly adding on Wednesday to $39.8 per barrel after a Tuesday’s downward correction. As a result of oil sagging, Russian energy companies will fall on Wednesday, Finam analyst Timur Nigmatullin said.

Key Asian markets are in the red zone in the morning, signifying a lack of investor interest in risky assets after China published weak trade surplus figures, Premier-broker analyst Alexei Kozlov said.

Traders will be wary of decisive moves ahead of a release of a U.S. Department of Energy’s report on oil reserves, which is expected to confirm the API data, Startsev said.

Russian investors will pay attention to a Sberbank’s financial report under Russian Accounting Standards, Shagov said.

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