Russian stocks may open in red on failed gas talks

MOSCOW, Oct 22 (PRIME) -- Russian stocks may open lower on Wednesday following failed gas talks between Moscow and Kiev, analysts said.

“Today the players may focus their attention on the results of the gas talks. It became known on Tuesday that Russian President Vladimir Putin and his Ukrainian counterpart Pyotr Poroshenko discussed the issue and the situation in Ukraine during a phone call, but reached no accord on the matter,” Anton Fomin, analyst at Instaforex, said.

The countries also failed to agree on winter gas supplies as Kiev has no money to redeem its debt and pay for the supplies in advance.

“The theme of geopolitical risks is likely to emerge today, which can push stock indices down,” Fomin added.

But foreign background is moderately positive, as U.S. stock indices are edging up, Asian floors are showing a strong upward dynamics and the Brent oil price stays virtually flat at U.S. $86.30 per barrel as of 8.45 a.m. Moscow time.

Promsvyazbank said the positive background will help the Russian market to open in the green. “From our point of view, trading will start with the MICEX index rising about 0.3%, while during the day it can try to climb above 1,400 points,” it said in a research note.

“The general background looks favorable and may be a factor in pushing prices up at the start of the trading session, but the improvement on the foreign bourses is mostly connected with Apple’s upbeat report, and this is not a good reason for capital inflow to the Russian market to restart,” Anton Startsev, senior analyst at Olma, said.

Investors will watch for the release of Bank of England’s minutes, Canada’s central bank decision on the key rate, and U.S. September inflation data.

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