Russian stocks fall as geopolitical situation worsens

MOSCOW, Oct 14 (PRIME) -- Russian stocks closed lower on Friday despite a positive external background as investors were worried about a worsening geopolitical tension around the country, analysts said.

The MICEX fell 0.50% to 1,966.39 and the RTS decreased 0.50% to 983.04.

“It looks like purchases were restrained on the Russian market by a continuous worsening of the external geopolitical situation. The E.U. foreign ministers plan to discuss new sanctions against Russia early next week,” Vitaly Manzhos, a senior analyst at Bank Obrazovanie, said.

Russian Foreign Ministry spokeswoman Mariya Zakharova said that the U.S. in such organizations like the International Monetary Fund and the World Bank received orders to block financing of all programs connected with Russia, Manzhos said.

“So far, Russian stocks have no reason for a positive mood. The U.S. retail data have shown growth today, which means a relative healthy state of the sector and does not contradict plans of the U.S. Federal Reserve System to increase the key rate until the end of the year,” Irina Rogova, an analyst at Forex Club group of companies, said.

Oil prices also provide no support, as the Brent tried to resume growth but was unable to hold above a U.S. $52 per barrel mark during the day. The effect from a possible OPEC production freeze deal has waned, while other factors like the U.S. oil reserves do not provide any support, Rogova said.

Manzhos said that the most significant movement in local shares was a fall of common and preferred shares of oil company Bashneft by 6.37% to 2,902.50 rubles and by 4.41% to 1,410 rubles. Investors were worried by a possibility that oil major Rosneft, which has recently bought a 50.08% stake in the company, may avoid an obligation to announce a mandatory buyback offer for Bashneft’s shares.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	+0.44	146.73	5.460
Gazprom	-0.92	136.20	1.767
Rosneft	-1.54	353.85	1.484
Bashneft	-6.37	2902.50	1.069
Lukoil	-0.66	3064.00	0.906

(63.3465 rubles – U.S. $1)

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