Russian stocks contract on oil price fall, negative environment

MOSCOW, Apr 15 (PRIME) – Falling foreign stock markets and contraction of oil prices ahead of a Sunday meeting of oil producing countries dragged Russian shares down on Friday, analysts said.

The MICEX fell 0.42% to 1,907.78 and the RTS decreased 1.01% to 905.10.

“Russian indices were partially under pressure from the general mood of the global market. Futures for the U.S., European, and Asian indices fell moderately today. The dynamics was based on both falling oil prices and statistics from China,” Irina Rogova, an analyst at Forex Club group of companies, said.

China’s gross domestic product (GDP) went up 6.7% in January-March, in line with forecasts, but industrial production and retail sales exceeded expectations. The country’s economy may stabilize soon, and threats to development of the global economy may wither. So, the U.S. Federal Reserve System will not have many reasons to delay the increase of its key rate, Rogova said.

The Brent oil price slumped 3.3% to U.S. $42.44 per barrel as of 6.05 p.m. Moscow time, according to the ICE exchange.

“We recommend a skeptical attitude toward the future event (meeting in Doha). First, it is very unlikely that all exporters will agree to freeze oil production at the January level…Second, even if we suppose that the agreement is reached, there will still be excessive supply on the world oil market,” Andrei Dirgin, head of the analytical department at Alfa-Forex, said.

If the agreement is reached, oil prices would not grow above $45 per barrel, as the positive effect from the agreement has already been priced in. But if the countries “agree to continue cooperation in stabilization of the market,” prices may very well return to the level of $40, Dirgin said.

“The confidence of market participants in the positive outcome of the meeting in Doha may be as big as it possibly can, but there is still a chance that the meeting will not meet expectations. So, ‘bears’ today fixed their long positions in oil,” Sofya Kirsanova, an analyst at managing company Raiffeisen Capital, said.

Electronic goods and household appliances retailer M.Video grew 3.25% to 270.30 rubles. The company’s financial performance was a pleasant surprise for investors, as its revenue grew 16% on the year to 54.574 billion rubles in January–March, even in spite of the low base effect of January–March 2015, Kirsanova said.

Shares of Russia’s leading gold producer Polyus Gold continued to grow after strong operating results published on Thursday. It gained 4.29% to 4,014 rubles.

Below are the MICEX’ five most active stocks on Friday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	0.00	119.30	8.389
Gazprom	-1.62	147.99	4.357
VTB	+0.56	0.07527	1.896
Norilsk Nickel	-0.33	9120.00	1.882
Lukoil	+0.28	2822.50	1.761

(66.4954 rubles – U.S. $1)

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