Russian stocks to dip as oil price subdued on freeze accord doubts

MOSCOW, Apr 4 (PRIME) -- The Russian stock market will edge down at opening on Monday as uncertainty over the future oil output freeze accord continues to pressurize oil prices, while the start of a military conflict between Armenia and Azerbaijan may hit Russia, analysts said.

“The persistent pressure on oil quotations can lead to a slightly negative market opening on Monday,” Promsvyazbank analyst Ilya Frolov said.

Oleg Shagov, head of investment company Solid’s research department, said that Brent futures’ fell below U.S. $38.5 after Saudi Arabia had said it will freeze its oil output only if Iran does the same, while its exports are rising noticeably.

“It is worth noting that Russia’s average daily oil output grew in March, setting a new post-Soviet record,” he said.

U.S. stock market futures are little changed, Asian stocks are fluctuating close to April 1 levels. The European premarket trading signals a higher opening, which makes for a neutral background in Russia, Shagov said.

Finam analyst Timur Nigmatullin said that an increase of tensions between Armenia and Azerbaijan will certainly have negative implications for the attractiveness of Russian assets because Armenia and Russia are in a military alliance.

Alor Broker analyst Alexei Antonov said that Gazprom can bolster the Russian market, a consolidation above 148–150 rubles signals a forthcoming increase to 167 rubles per share.

Nigmatullin said that the financial sector will dive on the back of the leak of information about offshore accounts held by many international leaders. Russia’s top lenders are allegedly involved in corruption schemes including money laundering in Panama, orchestrated by high-ranking government officials.

Lukoil will hold a presentation and a conference call after publishing a consolidated financial report under International Financial Reporting Standards (IFRS). Novorossiysk Commercial Sea Port (NCSP) will publish the financial report, which can influence the market trends of related assets, Shagov said.

(67.1410 rubles – U.S. $1)

End