Russian stocks rise as positive environ outweighs oil price slump

MOSCOW, Feb 16 (PRIME) -- Russian stocks grew on Tuesday as the positive impact from the external background outweighed the oil price slump after a meeting between Energy Minister Alexander Novak and his counterparts from Saudi Arabia, Qatar, and Venezuela failed to bring a strong positive outcome, analysts said.

The MICEX rose 0.88% to 1,753.86 and the RTS increased 0.19% to 708.61.

“The background for the Russian market today was moderately positive as the Chinese market grew significantly due to a record increase of crediting in January, the U.S. stock market continued to climb up after a long weekend, and European floors grew even after Germany’s ZEW index turned out to be slightly worse than expected,” Vasily Tanurkov, the deputy head of investment company Veles Capital’s stock market research department, said.

But the most important news was a meeting of the four oil ministers in Doha, after which they agreed that the countries should freeze their oil production in 2016 at the level of January if other oil producers join the agreement, he said.

The Brent oil price slid 1.489% to U.S. $32.90 per barrel as of 6.13 p.m. Moscow time, according to the ICE exchange. The ruble fell 1.15 rubles against the U.S. dollar to 78.10 as of 6.30 p.m., according to the Moscow Exchange.

“We all understand that this was only a formal measure, as Saudi Arabia constantly exceeds its own quotas. So, in order to balance demand and supply on the oil market quotas should be cut, not maintained,” Andrei Dirgin, the director of Alfa-Forex’ research department, said.

“Unfortunately, this agreement of ministers of oil producing countries is very likely to remain a verbal intervention. It will be some sort of a mid-term ‘scarecrow’ for weak-nerved oil bears,” Vitaly Manzhos, a senior analyst at Bank Obrazovanie, said.

The decision also raises some implementation issues in Russia. The government may make state-controlled companies to keep their production output through state orders, but it is unclear how it may force private companies do the same, Manzhos said.

Russian gas giant Gazprom outperformed the market and grew 1.81% to 135.85 rubles. The news that the company’s board of directors extended powers of CEO Alexei Miller for five more years is positive for Gazprom, as a lack of critical changes in the company is a positive signal for such a large player, Manzhos said.

Below are the MICEX’ five most active stocks on Tuesday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	+1.32	96.51	11.084
Gazprom	+1.81	135.85	6.677
Lukoil	+0.86	2450.00	2.420
Rosneft	+2.36	277.40	1.905
Norilsk Nickel	+1.69	8486.00	1.860

(77.7792 rubles – U.S. $1)

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