Russian stocks fall on unfavorable environ, sanction news

MOSCOW, May 19 (PRIME) -- The Russian stock market contracted on Wednesday as investors received only negative signals from the unfavorable external background and from the flow of mixed news regarding sanctions against the Nord Stream 2 pipeline, analysts said.

The MOEX Russia Index fell 1.44% to 3,634.76 and the RTS decreased 1.36% to 1,552.91.

“The Russian stock indices were falling moderately as they followed the worsening of mood of foreign markets,” Yelena Kozhukhova, analyst at Veles Capital, said.

The Brent and the WTI oil prices were losing around 2% in the middle of the day due to reports about a significant progress in nuclear negotiations between Iran and the West, while the European bourses fell together with the majority of risky assets. The mood of players on the U.S. stock market was negative as the yield on 10-year U.S. treasuries exceeded 1.6% at a time when investors were waiting for results of the Federal Reserve System’s latest meeting, she said.

Alexander Osin, head of Freedom Finance’s department for trade operations on the Russian stock market, said: “Besides that, the market has received another bearish signal today, as mass media reported that the U.S. may impose restrictions on companies that partake in construction of the Nord Stream-2 pipeline. But yesterday, media reported that (U.S. President) Joe Biden decided not to blacklist the construction’s operator, Swiss company Nord Stream 2 AG that is a 100% subsidiary of Gazprom, ahead of a meeting with (President) Vladimir Putin.”

Because of such a “volatile” news flow and due to contraction of international prices for natural gas, shares of gas giant Gazprom lost 2.90% to 258.50 rubles, Osin said.

Kozhukhova also said that ordinary and preferred shares of oil company Surgutneftegas gained 0.67% to 36.60 rubles and 2.09% to 46.37 rubles, respectively, as investors were pleased with the recommendation of the company’s board of directors to pay 6.72 rubles per preferred share and 0.70 rubles per ordinary share in dividends for 2020.

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

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Gazprom	-2.90	258.50	21.143
Sberbank	-3.00	296.61	20.150
VTB	-2.34	0.0446	15.200
Lukoil	-2.74	5830.00	9.498
Norilsk Nickel	-1.24	27014.00	7.772

(73.6992 rubles – U.S. $1)

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