Russian stocks to rise on positive news flow, high oil prices

MOSCOW, Jun 15 (PRIME) -- The Russian stock market is likely to start the Wednesday trade higher supported by high oil prices and a positive news flow, analysts said.

“We expect a growth of up to 1%. … It will be supported by the increase of oil prices, which may resume today after a slight correction,” Georgy Vashchenko, head of Freedom Finance’s department for trade operations on the Russian stock market, said.

The Brent oil price climbed to U.S. $125 per barrel, and the technical factors favor further growth in a few coming weeks to $130–140. Natural gas prices in Europe exceeded $1,000 per 1,000 cubic meters because maintenance works at the Nord Stream pipeline caused gas giant Gazprom to reduce pumping via the pipe by about 40%, he said.

The energy prices can trigger a rise in Gazprom and oil companies, Vashchenko said.

“The U.S. Treasury prolonged a license that allows companies to conduct energy deals with the sanctioned Russian banks, and it was good news for the national banking sector,” Andrei Vernikov, director of investment company Univer Capital’s department for investment analysis and education, said.

The U.S. Federal Reserve System is to decide on its rates today, the most important event of the week. The news flow prior to the opening of the Russian stock market is moderately favorable, Vernikov said.

Algo Capital senior risk manager Vitaly Manzhos also said that the background for the Russian stock market was positive as the futures for the U.S. stock indices rose by 0.1–0.4%, the Brent oil price gained 0.2%, the futures for the gold increased by 0.1%, and the Chinese stock index Shanghai Composite added 1.8%.

“We expect opening of the main trading session in Russia to start with a minimal change or a slight growth of up to 1% of the MOEX Russia Index in the range of 2,280–2,315. The levels of 2,270 and 2,250 will act as the closest support, while 2,320 and 2,340 will become the resistance,” Manzhos said.

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