Oil: Consent no OPEC, but the market will cope with the oil supply
At the end of this week the markets continue to worry about the extension of the trade war between the US and China, so the American and Chinese stock indexes finished trading week with a decline of 0.8% and 4.7%, respectively. European stock markets also declined by 2.5% against the background of widening of the spread between yields on Italian (2,72%) and German (0,33%) 10-year government bonds by 20 b.p. due to the appointment of eurosceptics in the Parliament of Italy for the posts in the Finance Committee and the budget Committee.
The MSCI index of developing countries also declined by 2.3% over the week. However, the index Mosberg increased by 1% to 2245 points, and on Thursday received the inflow of foreign liquidity, for example, the Delta of the movement of capital in the Fund Vaneck Vectors Russia ETF has changed to a positive value of $12 million, while the net outflow for 4 days is $63 million
Probably foreigners would like to participate in the closing of the register for the shares of Sberbank (June 26), 12 RUR per share, where the dividend yield on common and preferred stock is 5.7% and 6.4%, respectively. It is a liquid instrument, which is able to close the dividend gap in a few weeks, which will ultimately provide double-digit annual yield.
Against this background, and also due to tax payments the ruble strengthened against the dollar on Friday. However, the OPEC meeting on Thursday has shown that a common position on mitigation of the transaction OPEC “plus” no. It is expected that it may be decided to increase oil production by 1 million b/d, although actual production will amount to 600 thousand b/s assessment of Saudi Arabia. We believe that the market will absorb this increase without shocks, as in the last 12 months the shortage of supply of oil amounted to about 4.2 million barrels, according to the us EIA.