Stocks fall on lower foreign markets, key rate expectations

MOSCOW, Sep 8 (PRIME) -- The Russian stock market contracted on Friday because of the unfavorable external background and the impact of investor expectations of an increase of the central bank’s key rate, analysts said.

The MOEX Russia Index fell by 0.83% to 3,142.88 and the RTS decreased by 0.18% to 1.012.40.

“The Russian stock market fell under the pressure of negative dynamics on the global markets, and also waiting for the central bank’s meeting scheduled for September 15,” Yevgeny Linchik, head of managing company Pervaya’s department of alternative investment, said.

The U.S. stock markets fell because the economic statistics released earlier this week had a mixed impact on the market. The business activity in the service’s industry contracted, but the labor market statistics showed robust growth. These give no clear answer to investors about the decision to be taken by the Federal Reserve System at its September meeting, Linchik said.

“Expectations of the central bank’s increase of the key rate are one of the main trade ideas making the stocks less attractive as compared with the bonds,” Andrei Kochetkov, leading analyst for global research at Otkritie Broker, said.

Even the ruble is strengthening its positions right now because the supposed increase of the key rate would make the ruble bonds a more attractive alternative to the foreign currencies, Kochetkov said.

He also said that the shares of telecom giant Rostelecom grew by 1.64% to 76.80 rubles following a report by news agency Interfax that the Finance Ministry had coordinated a directive on the company’s dividends.

Veles Capital’s analyst Yelena Kozhukhova said that the receipts of X5 Retail Group rose by 0.47% to 2,254 rubles on media reports about the company’s plans to expand hard discounter chain Chizhik.

Below are the MOEX Russia Index’ five most active stocks on Friday:

Company	Change, %	Last price, rbl	Trading volume, bln rbl
Sberbank	-0.90	256.45	11.608
Lukoil	-0.58	6628.00	8.280
Rusolovo	+10.49	1..77	6.594
Gazprom	-1.09	175.70	4.992
Transneft prefs	+1..28	138700.00	4.396

(98.1961 rubles – U.S. $1)

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