Russian stocks fall on negative statistics, Fed’s statement

MOSCOW, Apr 6 (PRIME) -- Russian stocks contracted on Thursday as risk appetite was hurt by weak Chinese macro statistics and the tone of the U.S. Federal Reserve System’s (Fed) statement, analysts said.

The MICEX fell 0.08% to 2,054.69 and the RTS decreased 0.32% to 1,148.75.

“Besides the weak business activity statistics for March in China, the mood for purchases today was slashed by an upcoming meeting of leaders of China and the U.S., where they may discuss difficult trade relations of the two countries. In addition to that, risky assets were hurt by a ‘hawkish’ protocol of Fed’s March meeting,” Timur Nigmatullin, an analyst at investment company Finam, said.

Andrei Kochetkov, an analyst at Otkritie Broker, said that the Fed hinted that it might cut its balance sheet, an alternative to hiking the key rate. “Thus, the financial sector may be disappointed by the speed of the growth of lending costs with a simultaneous reduction in liquidity. Shares of banks in the U.S. and Europe reacted negatively to that,” he said.

Irina Rogova, an analyst at the Forex Club group of companies, said that a firming oil price prevented the Russian market from a stronger plunge.

“Iran has sold out all reserves and is unable to increase exports due to the production cut. Moreover, the market still hopes for OPEC to prolong the production reduction agreement on May 25. Still, balancing of the market may take more time if production in the U.S. continues to grow,” Rogova said.

Kochetkov said that shares of power grid holding Rosseti, earlier known as Russian Grids, rose 0.35% to 0.994 rubles after the company said its net profit rose 20.5% and revenue increased 17.8% in 2016.

He also said that interest in coal producers, including metals and mining group Mechel, whose shares rose 3.6% to 168.86 rubles, was supported with contractions in supplies of coking coal from Australia.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-0.36	167.49	4.091
Gazprom	-0.15	130.50	3.075
Lukoil	+0.02	3057.50	1.439
Norilsk Nickel	-0.58	9133.00	1.127
Rosneft	-0.07	337.95	1.105

(55.8940 rubles – U.S. $1)

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