Russian stocks fall on trade war, global market slump

MOSCOW, Oct 26 (PRIME) -- Russian stocks fell on Friday in line with the majority of foreign bourses as global players were worried over a possible U.S. economic growth slowdown, while Washington reminded about the trade war with China, analysts said.

The MOEX Russia Index fell 1.65% to 2,293.22 and the RTS decreased 2.00% to 1,098.32.

“The external background worsened significantly due to increased concerns over a possible slowdown of the economic growth in the U.S. At first, investors were disappointed with weak quarterly results of two large U.S. companies Amazon and Alphabet. Later in the day, long-awaited preliminary data on U.S. gross domestic product (GDP) dynamics for the third quarter was published. Analysts forecasted a slowdown of the U.S. GDP growth to 3.3% in July–September from 4.2%. The data showed it falling to 3.5%, which was a bit higher than expected but still failed to return the optimistic mood to the market,” Anastasia Sosnova, Freedom Finance’s analyst, said.

“The latest statements of the U.S. (president’s) administration reminded the markets about the acuteness of the trade war. The U.S. does not want any negotiations with China at least until it offers something solid. If the situation does not change before January 1, tariffs on U.S. $200 billion Chinese exports to the U.S. will rise to 25% from 10%. Obviously, the global market saw strengthening of the U.S. dollar and a decrease of yield on U.S. treasuries – a clear sign of flight from risks,” Andrei Kochetkov, Otkritie Broker’s analyst, said.

News from U.S. tech companies also did not ease concerns of investors, as Intel delayed introduction of 10-nanometer processors, Texas Instruments warned about shrinking demand for microchips, and the profit of AMD and NVidia were hurt by a slump of interest in cryptocurrency mining, Kochetkov said.

Algo Capital’s analyst Vitaly Manzhos said that common and preferred shares of Russian top bank Sberbank were weaker than the market today due to a noticeable fall of the ruble exchange rate. Common and preferred shares of the bank fell 3.06% and 2.84%, respectively.

Preferred shares of oil company Surgutneftegas outperformed the market today as large foreign currency reserves of the company protect the shares from contractions of oil prices and weakening of the ruble exchange rate, Manzhos said. The shares grew 0.47%.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-3.06	181.00	16.814
Lukoil	-1.1	4888.50	5.272
Gazprom	-2.02	152.50	3.713
Norilsk Nickel	-2.31	10650.00	2.173
Moscow Exchange	-4.32	83.50	1.443

(65.7476 rubles – U.S. $1)

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