Russian stocks may open flat as geopolitical risks rise

MOSCOW, Aug 4 (PRIME) -- Russian stocks are likely to open flat on Friday as geopolitical risks increased after media reports that Special Counsel Robert Mueller impaneled a grand jury to investigate alleged Russia’s interference with the 2016 U.S. presidential election, analysts said.

“It is possible that the rise of the RTS index may stop today in the first half of the day. Investors saw reports on summoning of a ‘grand jury’ for investigation of Russia’s influence on the U.S. presidential elections as an indicator of increasing geopolitical risks, which improved demand for defensive assets and increased volatility on the stock market,” investment company Olma’s leading analyst Anton Startsev said.

Oleg Shagov, head of investment company Solid’s research department, said that the background prior to the opening of the Russian market is close to neutral with futures for the U.S. stocks changing insignificantly and the major Asian floors showing no common dynamics. Purchases will also be restrained by the oil price fall, he said.

The Brent oil price lost 0.231% to U.S. $51.89 per barrel as of 9.03 a.m., according to the ICE exchange. Shagov said that oil is under pressure prior to a release of the U.S. drilling statistics taking into account that oil production in the country has resumed growth.

Startsev said that investors will track the release of non-farm payrolls data of the U.S. labor market later in the day, adding that the data often becomes a reason for volatility of the stock market to grow.

Shagov also said that releases of financial results by oil major Rosneft and by power utility Territorial Generating Company-1 (TGC-1) may drive the market.

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