Russian stocks to open flat as investors wait for OPEC decisions

MOSCOW, Apr 1 (PRIME) -- The Russian stock market is likely to open little changed on Thursday as investors wait for the members of the OPEC+ alliance to decide on their oil output quotas in May, analysts said.

“The external background is neutral for now, this is why the bellwether stocks will open today near the yesterday’s closings,” Alor Broker senior analyst Alexei Antonov said.

The OPEC+ alliance’s baseline option is to maintain the quotas at the current level, but the monitoring committee made no recommendations on Wednesday, which means that there are disputes and that discussions will continue on Thursday.

Oil companies looked weaker than the market in a few previous days in correction as they have been recently overbought. They can rise, if OPEC+ helps them, Antonov said.

“We expect the market to show sideways dynamics, with shares of the oil and gas industry being the outsiders. … Our calculations show that the MOEX Russia Index will spend the day within the range of 3,500–3,550,” Georgy Vashchenko, head of investment company Freedom Finance’s department of trade operations on the Russian stock market, said.

France set up a three-week quarantine with a possibility of prolonging until the COVID-19 situation improves. This pushed the oil prices down to U.S. $62 per barrel. If the epidemiologic situation in Europe does not improve, the oil prices will fall further, but contraction of oil production is unlikely, that is why Freedom Finance expects the cartel to maintain its quotas, Vashchenko said.

“In general, risky assets enter April on a positive note. One could expect optimism toward Russian assets to continue if the geopolitical background stays the same,” Yelena Kozhukhova, analyst at Veles Capital.

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