Russian stocks fall in correction after losing support from oil

MOSCOW, Dec 6 (PRIME) -- Russian stocks corrected downwards on Tuesday as the market lost support from oil prices and was unable to find strong drivers within the mixed external background, analysts said.

The MICEX fell 0.28% to 2,152.35 and the RTS decreased 0.85% to 1,059.97.

“On Tuesday, the Russian stock indices began their correction. In the first half of the day, the MICEX once again hit an all-time high and rose to 2,177.90, but retreated…only after Brent started to lose positions,” Irina Rogova, an analyst at Forex Club group of companies, said.

The Brent oil price lost 2.404% to U.S. $53.65 per barrel as of 6.17 p.m. Moscow time, according to the ICE exchange.

Timur Nigmatullin, an analyst at investment company Finam, said that the external background was mixed, as China’s CSI300 index lost 0.3%, while the composite European index Stoxx 600 has lost 0.58% by the middle of the day. “It seems that the pre–New Year rally on the Russian and world floors stopped ahead of a December 14 meeting of the U.S. Federal Reserve System,” he said.

According to special futures at the CME exchange, the chance that the regulator will increase the key rate at the meeting is 95%, but some assets have not yet priced possible risks. “So, there is a risk that the decision will be followed by a speculative correction in the form of a run into quality assets, especially on emerging markets in general and on the Russian market in particular,” Nigmatullin said.

Vitaly Manzhos, a senior analyst at Bank Obrazovanie, said that oil major Rosneft outperformed other blue chips and grew 0.33% to 352.65 rubles as investors were waiting for any news regarding privatization of a19.5% stake in the company.

Gas giant Gazprom looked weaker than the market and lost 1.48% to 151.50 rubles despite the news on ratification of an agreement between Russia and Turkey on construction of the Turkish Stream natural gas pipeline and Monday’s comment by President Vladimir Putin that the Nord Stream-2 natural gas pipeline will be constructed. The news mean higher capital expenditures in the coming years, Manzhos said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-1.65	159.35	7.601
Gazprom	-1.48	151.50	5.431
Rosneft	+0.33	352.65	3.615
VTB	-0.96	0.068	2.529
Lukoil	-0.98	3267.50	2.278

(63.9242 rubles – U.S. $1)

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