Stocks to open flat as investors await central bank meeting

MOSCOW, Jul 27 (PRIME) -- The Russian stock market will likely open with marginal changes on Friday as investors are waiting for the central bank’s board of directors to meet to decide on a key rate change, analysts said.

“I expect neutral dynamics. A meeting of the central bank is in the focus of the local market’s attention,” Georgy Vashchenko, director of operations on the Russian stock market at investment company Freedom Finance, said.

According to Finam analyst Sergei Drozdov, the central bank will most probably suspend reduction of the key rate.

Vashchenko said that the central bank’s fear that inflation may overshoot a 4% target by the end of the year and rise by 0.5 percentage points in 2019 makes indicates that the authority is likely to leave the key rate unchanged and reduce it by 0.25 percentage points only in December.

Anton Startsev, a senior analyst at investment company Olma, said that the rise of the U.S. Treasuries’ yield undermines investor interest to the stock markets though the pressure is so far not enough to cause a significant money outflow from stocks.

Drozdov said that the MOEX Russia Index support level is at 2,280 and 2,260, and the resistance level is at 2,300–2,315. The RTS support level is 1,140 and the resistance is 1,160 and 1,180.

Startsev said that the U.S. gross domestic product (GDP) figures for April–June to be published at 3:30 a.m., Moscow time are seen as the most interesting statistics report for Russian investors.

End