Russian stocks to sag at opening as oil price falls

MOSCOW, Apr 20 (PRIME) -- The Russian stock market will open lower on Wednesday because of a fall in oil prices, analysts said.

“A downward correction is possible today at the start of session. Kuwaiti oil producers have declared an end to the strike, and Brent futures are trading with a noticeable downward gap today,” Anton Startsev, leading analyst at investment company Olma, said.

Brent lost 2.61% to U.S. $42.88 per barrel at 9:26 a.m. Moscow time.

A lower Chinese market will contribute to the downbeat sentiment in Russia, Startsev said.

A U.S. oil reserves report will be a powerful driver for Russian stocks later in the day, Oleg Shagov, head of investment company Solid’s research department, said.

The reporting season will add volatility. Among Russian companies, Evraz will submit the report, Shagov said.

State companies are market leaders after Prime Minister Dmitry Medvedev ordered them to pay 50% of their net profit in dividends, Vitaly Manzhos, a senior analyst at Bank Obrazovanie, said.

The overheated banking sector will continue falling. Retailers will fall on the back of recent trade law adjustments, Finam analyst Timur Nigmatullin said.

President Vladimir Putin and Medvedev will meet with the participants of the United Russia party primaries, which will significantly influence market trends in Russia. Speeches by CEO of the largest lender Sberbank German Gref and by Energy Minister Alexander Novak are also noteworthy events, Shagov said.

Russian investors will also wait for a speech by European Central Bank’s Chairman Mario Draghi, he said.

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