MOSCOW, Apr 7 (PRIME) -- Russian stocks plummeted on Friday as investors run for quality on fears of Syrian conflict escalation, analysts said.
The MICEX fell 1.68% to 2,020.23 and the RTS decreased 3.07% to 1,113.45.
“Last night, the U.S. made an unexpected military strike on Syria. This prompted a mass exodus from international risks, including the Russian stock indices. Oil jumped due to the stronger geopolitical tensions, but the danger of worsening of the U.S.–Russia relations was stronger and made local investors to start selling,” Igor Kovalyov, an analyst at InstaForex group of companies, said.
The Brent oil price rose 0.417% to U.S. $55.12 per barrel as of 6.06 p.m. Moscow time, according to the ICE exchange, but earlier in the day the price even climbed above $56 per barrel.
“The Russian stock index nosedived on Friday after the restart of military action in Syria provoked by U.S. airstrikes on the Shayrat military base in response to chemical attacks in the province of Idlib. Although the U.S. told Russia that it was a one-time act of repression, the Russia–U.S. relations were hurt as actions of U.S. President Donald Trump zeroed all efforts of Russia in reaching a ceasefire in Syria,” Sofya Kirsanova, an analyst at managing company Raiffeisen Capital, said.
Sergei Melnikov, a senior analyst at Forex broker Global FX, said that Russia reacted to Washington’s actions and President Vladimir Putin deemed the act as an aggression against a sovereign state. “If the situation develops further in a negative way, it will only mean a serious worsening of dynamics of the Russian market,” he said.
Kovalyov also said that the financial sector was hurt by the fall of the ruble. Top bank Sberbank lost 3.58% to 161.49 rubles despite a report of a 54% jump in net profit in January–March.
Kirsanova said meat producer Cherkizovo Group rose 3.10% to 865 rubles after the company announced a purchase of grain producer Napko for 5 billion rubles. The deal looks like a step towards vertical integration, while Cherkizovo is to buy Napko from a controlling shareholder, which means a premium to the market, she said.
Below are the MICEX’ five most active stocks on Friday:
| Company | Change, % | Last price, rbl | Trading volume, bln rbl |
|---|---|---|---|
| Sberbank | -3.58 | 161.49 | 9.745 |
| Gazprom | -1.36 | 128.72 | 3.546 |
| Lukoil | -2.17 | 2991.00 | 2.393 |
| ALROSA | -3.26 | 88.57 | 2.148 |
| Rosneft | -0.59 | 335.95 | 1.996 |
(56.4369 rubles – U.S. $1)
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