Russian stocks can fall on global fears of key rates rise

MOSCOW, Sep 26 (PRIME) -- The Russian stock market is likely to start the Tuesday trade session with a fall because of global investors’ fears of another round of increase of key rates by monetary regulators, analysts said.

“We expect sales to moderately prevail in the Russian shares at the start of trade today, which is supported by a worsening of the external background," financial marketplace Banki.ru’s senior analyst Bogdan Zvarich said.

"The technical condition of the market supports a further downward correction. An increase above 3,075 could become a signal for a possible restart of growth because the level acts as the closest resistance line for the market,” the analyst said.

The mood of players on the foreign markets is negative on Tuesday morning because the expectations of a further toughening of the monetary policy by the U.S. stimulates investors to reduce the amount of risky assets in their portfolios, he said.

The leading Asian bourses are falling by up to 1.1%, the futures for the major U.S. stock indices are losing up to 0.4% on Tuesday morning after a slight correctional growth on Monday, and the Brent oil price is sliding by 0.4% to U.S. $91.5 per barrel, Zvarich said.

Alexander Arutyunyan, senior analyst at investment company Russ-Invest, said that the stock markets of the world are facing another wave of sales after U.S. and E.U. officials made statements about a possibility of the rates staying high.

“The growth of the U.S. dollar that we see, given the increase of the yield on the U.S. treasuries (the 10-year ones reached 4.55% annually, and the real yield has finally become positive) and the contraction of oil prices (to $92.85 per barrel), is absolutely logical if the central banks of the E.U. and the U.S. continue raising their key rates. In this case, the stock markets may face another wave of sales,” Arutyunyan said.

End