Russian stocks fall as investors expect tough times for economy

MOSCOW, Apr 13 (PRIME) – The Russian stocks contracted on Monday as investors all around the world are wary about the economic woes due to the coronavirus outbreak, while the latest OPEC+ oil output reduction deal was not enough to outweigh the negative impact of the pandemic, analysts said.

The MOEX Russia Index fell 1.83% to 2,628.85 and the RTS decreased 1.50% to 1,124.97.

“Sales prevailed on the Russian market, as the OPEC+ deal has taken place and expectations have realized. March statistics is to be released soon to provide data on possible contraction of the global economy…It is fairly obvious that the coronavirus impact will be rather painful,” Andrei Kochetkov, senior analyst at Otkritie Broker, said.

“That is why the OPEC+ deal only cancels the worst scenario of overstocking at oil storages, but it does not allow us to expect deficit of oil supply.”

Anton Pokatovich, senior analyst at BCS Premier, said that Russia’s share of 2.5 million barrels a day is a very tough scenario for the country because such a sharp reduction may lead to heavy losses in the resource base, hurting the entire industry.

“Our estimates show that the ultimate impact from these reductions may cause a significant slump in industrial production, and the decrease may reach 7–12% this year. Such a noticeable fall in the industry will inevitably exert significant pressure on the gross domestic product of Russia,” Pokatovich said.

The coronavirus factor is also very prominent in Russia, as the epidemic in the country has not yet peaked out and its pressure on the economy and consumer demand will be strong, he said.

Yaroslav Kabakov, director for strategy at investment company Finam, also said that the Russian market fell as the situation for businesses in the country was getting worse and worse due to the measures for fighting of the coronavirus outbreak.

Kochetkov also said that oil producers Rosneft and Lukoil contracted by 2.12% and 1.75%, respectively, due to the impact of the OPEC+ deal.

Diamond mining giant ALROSA lost 2.41% as the securities still react to a sharp decline in diamond sales in March, he said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-1.85	198.26	8.213
Gazprom	-2.05	188.07	5.383
Lukoil	-1.75	5040.00	4.736
Norilsk Nickel	-2.66	20100.00	3.829
Rosneft	-2.12	336.70	3.332

(73.7515 rubles – U.S. $1)

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