Russian stocks fall on exacerbation of US–China conflict

MOSCOW, Aug 7 (PRIME) -- Russian stocks fell on Friday together with the majority of foreign bourses as markets were reacting to the recent exacerbation of the conflict between the U.S. and China, analysts said.

The MOEX Russia Index fell 0.54% to 2,972.35 and the RTS decreased 0.86% to 1,271.43.

“In the first half of the day, the MOEX Russia Index tried to stay in the green zone, but the external background prevented the market from doing it. The exacerbation of U.S.–China trade conflict once again became the reason of global pessimistic moods. U.S. President Donald Trump ordered to cut all transactions with owners of ByteDance and Tencent, owners of TikTok and WeChat, respectively, which may cause China to retaliate,” Andrei Kochetkov, lead analyst for global research at Otkritie Broker, said.

The Brent oil price fell below U.S. $45 per barrel, which creates additional pressure on the oil sector and the ruble, he said.

Vitaly Manzhos, senior risk manager at investment company Algo Capital, said that the decrease of Russian indices was only natural taking into account the worsening of external background, but the fall was not as deep as the news flow provided mixed signals and oil prices stayed relatively high.

“The negative impact from continuous disputes between the U.S. and China in many areas was smoothed out by expectations of new stimulation measures in the U.S.; in particular, President Trump has already announced a possible signing of a decree to prolong markups to jobless benefits and prolong easing of some payroll taxes,” Manzhos said.

Kochetkov also said that the shares of Russia’s second largest bank VTB fell 3.25% to 0.0366 rubles under pressure from unimpressive financial performance. The bank’s net profit fell by 45.4% on the year to 41.9 billion rubles in January–June.

Manzhos also said that dive of ordinary and preferred shares of telecommunications company Central Telegraph by 33.16% to 19.35 rubles and by 36.71% to 17.86 rubles, respectively, was the most noticeable movement in second-tier shares. The shares returned to the level that they had before the company’s board of directors announced generous dividends, he said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Polyus	-2.69	18092.00	8.306
Sberbank	+0.36	226.81	7.643
Norilsk Nickel	-2.60	20300.00	5.676
Gazprom	-1.15	186.90	5.173
VTB	-3.25	0.0366	3.535

(73.0397 rubles – U.S. $1)

End