Russian stocks can firm as market hopes for productive OPEC+ meeting

MOSCOW, Jun 5 (PRIME) -- The Russian stock market can edge up at the start of Friday’s trading session as the market hopes that a meeting of the OPEC plus deal participants on Saturday will improve fulfillment of the output reduction deal, analysts said.

"The external background before the start of trade in Russia is slightly positive. The Asian indices continue to price in the new stimulating measures. In terms of oil, hope emerged that the OPEC plus meeting would be held soon, which means that the less disciplined participants have promised full compliance with their obligations," Otkritie Broker analyst Andrei Kochetkov said.

The Brent price rose by 0.25% to U.S. $39.97 on Thursday.

According to Sergei Drozdov, analyst at investment company Finam, the prices were supported by a statement by Russian Energy Minister Alexander Novak that the market was recovering thanks to an OPEC plus deal and production decrease in other countries, while excessive supply was cut to 7 million barrels per day. Novak said that the market would reach balance in July with a possible deficit amounting to 3–5 million barrels per day.

But according to Drozdov, the postponement of the OPEC plus monitoring committee meeting to June 17, as reported on Thursday evening, kept the market in suspense.

Alor Broker’s senior analyst Alexei Antonov said that after that a report about plans to hold the meeting on Saturday appeared, and the market expects prolongation of current output cuts for July. If the meeting produces no surprises, the market will likely take profit on June 8, he said.   

Drozdov put the MOEX Russia Index local support level at 2,735 and 2,690, if the lower level is reached, the index can fall to 2,600. The local RTS index support level is 1,240 and 1,220 and resistance 1,280.    

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