Russian stocks may open flat on Thursday as oil price slides

MOSCOW, Aug 31 (PRIME) -- Russian stocks may open close to flat on Thursday as oil prices are in a slight downward correction due to consequences of Harvey hurricane in the U.S., analysts said.

“Today the growth of the RTS index may stop at the beginning of trade due to a downward correction at the oil market, as suspension of a large amount of oil refining capacities in the U.S. due to tropical storm Harvey has a negative impact on aggregated demand for crude oil,” Anton Startsev, a leading analyst at investment company Olma, said.

The Brent oil price slid 0.138% to U.S. $50.79 per barrel as of 8.45 a.m. Moscow time, according to the ICE exchange.

“Besides that, yesterday’s U.S. GDP (gross domestic product) turned out to be better than forecasted and triggered strengthening of the U.S. dollar on the world currency market, which may curb relative attractiveness of emerging markets for investors,” Startsev said.

Viktor Makeyev, a financial analyst at Forex broker Gerchik&Co, said that an eight-day growth streak of the RTS index may be stopped at the beginning of trade by the fall of oil prices, but strong U.S. macro statistics and a positive mood of global markets favor buyers.

Bodgan Zvarich, an analyst at investment company Freedom Finance, said that the background prior to the opening of the Russian stock market is controversial as lower oil prices provide a negative momentum while Wednesday’s upward dynamics of U.S. stocks and Thursday’s dynamics of futures for the indices support local bulls.

“We think that the negative impact of the oil market will outweigh the positive mood under the current conditions, which will lead to contraction of the indices at the beginning of the day…But the situation at external floors will restrain sales in our shares. We should note that the start of trade in Europe, where major indices may continue to grow, is likely to allow our market to regain some losses,” Zvarich said.

Investors will focus on the U.S. statistics, including consumer inflation and jobless claims, indices of personal incomes and spending, and the Chicago Purchasing Manager Index, Zvarich said.

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