Russian stocks to rise as oil recovers, Fed plans to cap growth

MOSCOW, Apr 8 (PRIME) -- The Russian stock market will edge up at opening on Friday as a driving force represented by recovering oil prices will be restrained by recent statements by the U.S. Federal Reserve System (Fed) suggesting a fast key rate increase, analysts said.

“The Brent quotations’ increase above $40 per barrel favors a moderately positive market opening and new attempts to break through a 1,870 (MICEX) notch amid a favorable external situation,” Promsvyazbank analyst Ilya Frolov said.

Oleg Shagov, senior analyst at investment company Solid, said that the MICEX will likely open at about 1,860, and the resistance level is at about 1,880, Shagov said.

Global markets will price in Thursday’s statement by U.S. Fed Chairwoman Janet Yellen, who emphasized growth of the U.S. economy and inflation as a suitable background for the key rate increase policies. Pavel Salas, general director for Russia and CIS at brokerage company eToro said that these words can become a warning for investors because they are in a sharp contrast to the recent dovish statements.

Shagov said that oil price fluctuations, Western indices’ dynamics and the ruble trends will be the main factors defining the dynamics of Russian stocks on Friday.

The meetings of boards of directors of mobile operator MTS and Moscow United Electric Grid Company (MOESK), which will consider issues related to forthcoming general meetings, will also influence dynamics of related asset’s prices, Shagov said.

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