Russian stocks seen flat on oil price dip, foreign markets rise

MOSCOW, Jan 25 (PRIME) -- The Russian stock market can open with marginal changes on Wednesday after growing on Tuesday amid an oil price dip balanced by an increase on foreign trading floors, analysts said.

“The ultimate influence of key external factors that have a significant impact on the Russian financial market is close to neutral today in the start of the day in our opinion,” Oleg Shagov, head of investment company Solid’s research department, said.

Finam analyst Timur Nigmatullin said that the MICEX will need some time to consolidate after significant growth on Tuesday.

Brent futures are under pressure after publication of U.S. American Petroleum Institute (API) statistics, indicating an increase of the U.S. oil reserves. U.S. stocks futures and Asian markets are rising, and the European premarket also suggests a small increase during the session start, Nigmatullin said. All these factors, according to Shagov, will likely to trigger a neutral market opening in Russia.

Ilya Frolov, a senior capital market analyst at Promsvyazbank, said that investors have an increasing appetite for risk amid a positive trend in the oil price and metals before long Chinese holidays. A decision by the U.K. Supreme Court to make the parliament vote on Brexit reduces the chances of harsh consequences. The willingness by the European Central Bank to prolong the stimuli until at least the end of 2018 also supports bulls.

The MICEX will likely grow to 2,180–2,210, Frolov said.

Frolov also said that a release of Russian statistics data, such as real disposable income, retail sales and unemployment will provide important insights. U.S. oil and oil product reserves are the most important expected foreign statistics release.

The Association of Russian Banks will hold an online discussion about the forecasts and scenarios of 2017. According to Shagov, this discussion can become the most important Russian event on Wednesday.

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