Russian stocks to trade sideways early on jittery market

MOSCOW, Apr 5 (PRIME) -- The Russian stock market is likely to be volatile and trade sideways early on Tuesday, analysts said.

“Worsening political background will continue exerting pressure on Russian shares,” Alor Broker senior analyst Alexei Antonov said.

“Europe started talking about new anti-Russian sanctions, and Reuters reported in the night that the U.S. Treasury prohibited Russia from paying on the Eurobonds from the U.S. accounts and JPMorgan Chase from handling Russia’s latest payment on the 2022 and 2042 Eurobonds.”

But rising oil prices may prompt investors buy Russian oil companies, Antonov said.

The European natural gas prices may rise triggering purchases in the shares of gas giant Gazprom. Metals giant Norilsk Nickel may grow in an attempt to catch up with the last week’s rally, he said.

“We expect Russia’s main trading session to start with an up to 1.5% change in the MOEX Russia Index in the range of 2,745–2,830. The levels of 2,730 and 2,700 will act as the closest support, while 2,850 and 2,880 will become the resistance,” Vitaly Manzhos, senior analyst at investment company Algo Capital, said.

“After opening with a change that is now considered moderate, the MOEX Russia Index may switch into consolidation. From a technical point of view, stabilization of the index in the second half of yesterday will aid it.”

The futures for the U.S. indices fell by up to 0.1% on Thursday morning, the futures for gold remain flat, the Japanese index Nikkei225 gained 0.1%, while the Chinese bourses are closed due to a national holiday, he said.

The Brent oil price gained around 1.4%, which makes the external background for the market slightly favorable and creates formal conditions for a positive start of the day in the MOEX Russia Index, but the oil price factor has no previous importance now, Manzhos said.

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