Russian stocks can rise on dovish Trump’s speech on China

MOSCOW, Jun 1 (PRIME) -- The Russian stock market will likely increase on Monday at the start of the trading session because a speech by U.S. President Donald Trump concerning China did not contain any details of measures that the market feared, analysts said.

"A certain increase of the RTS index is possible today at the start of trade but there is not enough reason to stop consolidation. Trump’s speech on China was not as tough as many market participants expected, which favors resumption of demand for risk after a small pause," Olma senior analyst Anton Startsev said.

Sergei Drozdov, analyst at investment company Finam, said that the U.S. president did not introduce sanctions against Chinese officials, contrary to what was expected, and did not mention revision of a trade deal, which supports a good mood on the market.

Head of the U.S. Federal Reserve System (Fed) Jerome Powell also supported the markets, confirming willingness to use every available instrument to strengthen the economy in the conditions of pandemic.

Brent rose by 4.39% on May 29 to U.S. $37.75 on the back of a report by Baker Hughes that said that the number of active rigs fell by 15 to 222, Drozdov said. On Monday, Brent retrenched by 0.61% to $37.61 as of 9:14 a.m., Moscow time. 

He said that according to media reports, OPEC plus deal participants may reschedule the next meeting from June 9–10 to Thursday, and the oil market is almost sure that the meeting would result in a hard-won compromise over whether to raise the output in July.   

The analyst put the MOEX Russia Index support level at 2,680 and 2,600, and the key resistance at 2,800. The local RTS index support is 1,200 and 1,180 and resistance 1,220 and 1,250.   

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