Russian stocks can drop as investors scared of US–N Korea clash

MOSCOW, Aug 11 (PRIME) -- Russian stocks are likely to fall at Friday opening because investors have started to avoid risks as a conflict between the U.S. and North Korea is breaking out, analysts said.

“A downward correction of Russian stock exchange indices can deepen today at the start of the trading session under a pressure of the external background. Investors’ tendency to take on risks remains under pressure due to uncertainty with North Korea, growth of the VIX volatility index (to 16 from 11.1 in a single day) signals a possible start of flight from risks; in these conditions capital inflow on developing markets looks improbable,” investment company Olma’s senior analyst Anton Startsev said.

Pyongyang said late Wednesday that it can strike at Guam with its missiles, answering to a promise by U.S. President Donald Trump to respond with ‘fire and fury’ to any future threats.

Oleg Shagov, head of investment company Solid’s research department, said that Brent futures descended to U.S. $51.5 per barrel as the drilling activity in the U.S. is expected to increase and market participants are skeptical about OPEC states’ ability to reduce the oversupply fast.

U.S. stock market futures are slightly falling, as well as the key Asian indices. The premarket of the European session is signaling a decrease of the leading European indices at the start of the trading session. All these factors are making for a moderately negative background at the start of the Russian trading session, Shagov said.

The MICEX is expected to open at 1,950–1,955, he said.

According to Shagov, publication of financial data of Polyus is expected to be the main corporate event on Friday.

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