Russian stocks seen opening flat on neutral background

MOSCOW, Mar 30 (PRIME) -- The Russian stock market is likely to open with little significant changes on Tuesday as the external background does not provide any strong drivers outside of a slight contraction of oil prices, analysts said.

“The end of the quarter may force the large players to ramp up their purchases today or tomorrow to raise the prices and improve client profits and their fees,” Alor Broker senior analyst Alexei Antonov said.

“But the external background is calm now, and all key exchange assets trade close to yesterday’s closing. Which means that we will open without significant movements.”

On Monday, the Russian market gained 1.1% despite a lackluster external background, which means that the market tried to eliminate the gap between it and the other markets using the inflow of money from the Western and local investors. On Tuesday, overbought ferrous metals producers will remain interesting as the prices for steel continue rising, Antonov said.

“We expect the MOEX Russia Index to edge down at opening within 0.1–0.4% in the range of 3,515–3,525. The levels of 3,510 and 3,500 will act as the closest support, while levels of 3,540 and 3,550 will become a significant resistance,” Vitaly Manzhos, senior risk manager at investment company Algo Capital, said.

The MOEX Russia Index is likely to price in the worsening mood on the oil market at the beginning of the day, but should switch to consolidation after that, Manzhos said.

The Brent oil price lost 0.508% to U.S. $64.65 per barrel as of 9.07 a.m. Moscow time, according to the ICE exchange.

Manzhos also said that Monday’s decision of Canada to slap sanctions on some individuals and companies that participated in construction of a bridge from Russia to Crimea was among the most notable international news, as well as a similar move of Australia. These steps are painless for the Russian stock market and the currency, but remind people about external anti-Russian sanctions, he said.

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