Russian stock market grows due to the increase in the rating

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After three sessions of correction in the second half of last week, on Monday, the Russian market has returned to growth. External background after some hesitation in Asia has improved, and European markets are green in color. The oil still has difficulty with growth, but is trying to stay in positive territory after this morning’s drawdown. Domestic assets play in the decision of Moody’s raising the rating of the Russian Federation. All this provided a positive impulse leading stock indices on Monday. Index Mosberg and RTS increased on average by 0.5%.
Ruble, despite the further strengthening of the dollar on the Forex market, also trading in positive territory, albeit moderate. The pair dollar/ruble has touched the support area of 65.50 RUB, limited local drawdown of quotations and provided a small pullback. To compensate for the absence of a clear positive signals from the oil market and pressure the dollar the Russian currency helps enhance the country’s rating. Investors also enjoy the distant prospects of new sanctions by America, which is busy resolving domestic problems.
By the way, at the end of this weeks expire, in which officials must agree on a budget financing – temporary funding ends February 15. If consensus is not reached, followed by a new shutdown that will hit risky assets.
Also the attention of players will be focused on trade negotiations between the US and China. At this moment investors are very optimistic about the new round of consultations, thus there is a risk of a resumption of sales on the stock markets, if the parties have not made significant progress. This threat applies to the Russian market, which in conditions of tense atmosphere is unlikely to be sustained for the whole week.
Gennady Nikolaev
Academy of management Finance and investment