Russian stocks may rise at opening on favorable environment

MOSCOW, Aug 11 (PRIME) – The Russian stocks may start Tuesday trading with a slight increase thanks to support from the U.S. bourses and stable oil prices, analysts said.

“Today, the RTS Index is likely to grow at the beginning of the day as the dynamics of oil prices and defensive assets allows us to register softening of the external background. At the same time, the factors of uncertainty are still prominent, which prevents a consistent upward trend on the stock market,” investment company Olma’s senior analyst Anton Startsev said.

Vasily Karpunin, analyst at BCS Broker, said that the background was positive – the futures for the S&P 500 index rose by 0.2% prior to the start of trade in Russia, while the Brent contracts with expiration at the end of August grew by 0.4% to U.S. $45.1 per barrel.

“Taking into account the results of yesterday evening trade, we may suppose that the MOEX Russia Index will open above the Monday closure level if the external background stays the same,” Karpunin said.

Alor Broker’s senior analyst Alexei Antonov also said that the U.S. stock indices grew Monday after the Russian market had closed, and the futures for the indices grew on Tuesday morning meaning that the Russian stocks should open higher to compensate yesterday’s contraction.

But Georgy Vashchenko, head of the department for trade operations on the Russian stock market at Freedom Finance, said that the market may fall this morning in spite of the favorable environment.

“In spite of the positive external background, it is more likely that the Russian market would experience moderately negative dynamics. Technical data signals a U-turn in the metals sector, in particular in the shares of NLMK and Severstal. … The guidance for the MOEX Russia Index is 2,900–2,950,” Vashchenko said.

He also said that investors will focus on a financial report for January–June that metals giant Norilsk Nickel is to release. The prices for nickel and platinum recovered to the levels of the beginning of the year, and palladium is more expensive than in October–December 2019, but it is unclear how much money the company reserved for the fines and compensation of damages following an oil product spill in May. The company may have to cut dividends by 30–50%, Vashchenko said.

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