Russian stocks fall on sanction talks, unfavorable environment

MOSCOW, Sep 18 (PRIME) -- The Russian stock market fell on Monday, because investors were concerned with the E.U. discussions of new sanctions against the country, while the background for the market was unfavorable, analysts said.

The MOEX Russia Index fell 0.55% to 3,135.18, and the RTS decreased 0.45% to 1,024.52.

“The dynamics of the market was caused by a lack of local drivers for a further upward movement. Besides, the growth was restricted by the negative news. The E.U. is preparing for a discussion of a new package of sanctions against Russia, and the new package may come into force already in October,” managing company Pervaya’s analyst Ivan Kapustyansky said.

Nevertheless, the Russian market has some prospects for growth in the medium term, and the coming payments of interim dividends by the national companies and high prices for oil support the expectations, he said.

“The Russian stock market was experiencing a moderate contraction in the middle of the session, as it was uncertain near the resistance levels, because the purchases were not happening on the foreign bourses anymore,” Yelena Kozhukhova from Veles Capital said.

The Bank of England and the U.S. Federal Reserve System are likely to send moderately hawkish signals later this week, which restricts the activity of the buyers. Russian investors also took a pause to think about their actions given the economic uncertainty and the risks of inflation breaking out once again because of high oil prices, she said.

The shares of diamond mining giant ALROSA lost 1.40% to 75.92 rubles, as they were hurt by the rumors about a possibility of the West banning procurements of the company’s diamonds, Kozhukhova said.

Kapustyansky also said that the preferred shares of oil pipeline monopoly Transneft gained 2.48% to 151,000 rubles following the announcement of a 100-for-1 stock split. The most expensive share on the Russian market will become affordable for a wider range of investors, he said.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
United Wagon Company	+14.71	134.90	10.929
Transneft prefs	+2.48	151000.00	10.449
Sberbank	-0.34	259.95	6.870
Lukoil	-0.53	6518.00	5.155
Gazprom	-0.66	172.65	2.877

(96.6338 rubles – U.S. $1)

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