Russian stocks decrease on possible cancellation of US–China deal

MOSCOW, Aug 20 (PRIME) -- The Russian stock market fell on Thursday as the foreign markets were worried about expected cancellation of a U.S.–China trade deal, analysts said.

The MOEX Russia Index slid 2.06% to 2,993.69, and the RTS index decreased 3.31% to 1,272.81.

"The Russian market had a few things to worry about. U.S. President Donald Trump is tolerant to the idea of a crumbling trade agreement with China. The Federal Reserve System (Fed) warns about the uncertainty of economic recovery and about the need for further fiscal stimuli," Otkritie Broker analyst Andrei Kochetkov said.

Kochetkov said that China agreed to revise the deal with the U.S. in the next few days but the negotiations might bring about no result.

He added that the lack of agreement on the new fiscal stimuli in the U.S. Congress and a warning by Secretary of State Mike Pompeo to China against possible meddling in the sanctions against Iran added to market pressure around the globe.

Trump still wants to withdraw some revenue from the sale of the English segment of China's TikTok for the U.S. treasury, which as follows from a statement by Director of the U.S. National Economic Council Larry Kudlow, is also bad news, according to Kochetkov.

Valery Yemelyanov, analyst at Freedom Finance, said that the key foreign markets were mainly in the red zone on disappointment by the news that the protocol of a July meeting of the U.S. Fed held no clear strategy to curb recession in the U.S.

Kochetkov said that oil was under the pressure from the coronavirus news as the number of new cases in Germany exceeded 2,000 per day, and the situation in France and Spain deteriorated.

Yemelyanov said that the RTS slid and the MOEX Russia Index did little better as the ruble weakened.

Kochetkov said that Yandex surged on the news that its weight in the MSCI Russia will rise to 9.44% from September 1.

Yemelyanov said that Rostelecom and Mechel were the loss leaders with Rostelecom sliding 4.33% on the ex-dividend gap and Mechel's common shares 2.40% on the news that its revenue fell by 11% in January–June.

Below are the MOEX Russia Index’ five most active stocks on Thursday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-3.63	230.7	26.484
Yandex	+1.26	4678	12.979
Norilsk Nickel	-3.37	19810	8.421
Gazprom	-1.94	185.58	6.723
Lukoil	-3.02	5088	6.002

(73.2392 – U.S. $1)

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