Russian stocks seen opening flat as central bank to mull key rate

MOSCOW, Apr 24 (PRIME) -- The Russian stock market will be little changed at Friday’s opening because investors are waiting for a central bank board meeting to consider the key rate, analysts said.

"We expect marginal dynamics. The market will reflect the external background," Georgy Vashchenko, head of the department for trade operations on the Russian stock market at investment company Freedom Finance, said, adding that the market will be waiting for a key rate decision of the central bank.

"100% of the polled economists think that the Central bank of Russia will cut the key rate, some authoritative sources think that the decrease may amount to 0.75 percentage points. We think that the key rate will be cut to 5.5%," Vashchenko said.

He said that the businesses and the population are suffering from a loan burden, and the cost of the loans must fall. The second possible reason for the move is a low inflation risk.

Sergei Drozdov, analyst at investment company Finam, said that an experimental drug against the coronavirus did not pass the first clinical trial. Remdesvir, that earlier drove the U.S. markets to new highs, did not improve the state of patients and did not reduce the viral load in blood. 

Brent grew by 3.95% on Thursday to U.S. $21.56. On Friday, it rose by 4.50% to $22.29 as of 8:58 a.m., Moscow time, a positive factor for the Russian market, according to Drozdov.

Drozdov put the MOEX Russia Index support levels at 2,550 and 2,500, resistance at 2,610 and 2,640. The local support level of the RTS Index is 1,060 and 1,042, resistance at 1,100 and 1,140.

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