Russian stocks fall on negative backdrop, oil price contraction

MOSCOW, Nov 11 (PRIME) -- Russian stocks decreased on Friday on the back of an unfavorable external background and falling oil prices, which pushed the ruble down, analysts said.

The MICEX fell 0.59% to 2,031.92 and the RTS decreased 2.38% to 970.15.

“In general, the dynamics of the Russian benchmark are not surprising. The international indices showed a downward correction during the day, which was likely connected to profit taking prior to the weekend rather than to any fundamental factors. But the oil price dynamics provided a negative impact,” Irina Rogova, an analyst at Forex Club group of companies, said.

The Brent oil price lost 2.025% to U.S. $44.93 per barrel as of 6.15 p.m. Moscow time, according to the ICE exchange.

“A downward correction of oil prices…led to a significant weakening of the ruble. Besides the oil price, pressure on the ruble was also exerted by its falling attractiveness for carry trade operations after the yield of the U.S. Treasury securities jumped to 2.15% from 1.7% over a couple of days,” Sofya Kirsanova, an analyst at managing company Raiffeisen Capital, said.

Global investors started to withdraw money from developing markets, including stock and debt markets, and latest EPFR data confirmed it, Kirsanova said.

Vitaly Manzhos, a senior analyst at Bank Obrazovanie, said that shares of metals giant Norilsk Nickel increased 1.04% after the company’s board of directors recommended paying 444.25 rubles per share in dividends for January–September, which accounts for about 4.3% of the current shares price.

Preferred shares of oil company Surgutneftegas increased 0.42% due to the weakening of the ruble, as dividend payments on the shares for the year largely depend on the rate at end of the year, Manzhos said.

Contraction of oil prices led to sales of oil companies. Lukoil, Rosneft, and Tatneft lost 1.69%, 2.55%, and 4.68%, respectively. The year-on-year contraction of January–September net profits of Rosneft and Bashneft under International Financial Reporting Standards (IFRS) also had a negative impact on the sector, Manzhos said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-1.21	151.51	10.595
Gazprom	+0.33	147.88	6.722
Norilsk Nickel	+1.04	10150.00	4.556
Magnit	+0.61	9910.00	3.377
Lukoil	-1.69	3092.00	3.135

(63.4161 rubles – U.S. $1)

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