The Russian stock market: growth Potential is limited

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The Russian stock market on Thursday began the auction limited growth. To date, major indexes are rising on average 0.2%. Morning list of outsiders stocks of “Mechel” coal company “Raspadskaya”. In the positive zone remain paper AFK “System” and “NLMK”.
Positive dynamics is also observed in the shares of “Tatneft” (+0,75%). Yesterday the company published an ambitious development strategy up to 2030. So, the company plans over the next 10 years to increase oil production by 33%, to 38.4 million tons, the processing volume from 8.2 million tons to 14.8 million tons and a market capitalization of up to $31-50 billion depending on market conditions.
To date, the company’s capitalization is about $28 billion, the bulk of investments will be directed to exploration and production: for this purpose Tatneft is ready to allocate nearly 800 billion rubles. In General, the company has planned investments in the amount of 1,16 trillion roubles. it is Interesting that by the end of the period EBITDA Tatneft is expected to grow to 519 billion RUB 161 billion rubles in 2017. Performance, has set the company on a specified time period achievable, but much will depend on oil prices and tax laws.
Among other corporate events it is necessary to highlight the extraordinary General meeting of shareholders GK “Cherkizovo”.
The external environment for today’s session formed mixed. American markets closed the previous trades sales index futures S&P premarket reduced. Oil prices returned to growth. The barrel of Brent rises in price on 1% and costs $81,63, the barrel of WTI is trading at $72,43 (+1,2%). Presented data from the US Department of energy showed that stockpiles of oil rose last week to 1,852 million barrels vs. expectations for a decline of 1,279 million barrels. This is quite a bearish signal, but speculators are placing greater emphasis on expectations of OPEC steps+ and geopolitics than American statistics.
Euro/dollar on Thursday morning with lowering. Main trades are around 1,1700. Today the market will continue to assess the results of the meeting of the Federal reserve system of the United States, where it was decided to raise interest rate by 25 basis points to 2.25% and announced further fiscal steps by the American regulator.
Morning interest rate decision has taken the Reserve Bank of New Zealand, the rate has remained unchanged at 1.75 percent. Later, the U.S. will release data on orders for durable goods for August. Also, the country will represent the growth rate of GDP for the second quarter and pending home sales in the real estate market.
The Russian ruble traded mixed during the first hour of trading in a basket of currencies. The US dollar is worth 65,82 rubles (+0,05%). Activity in ruble pairs is minimal, but it is likely this is due to the presence of a large number of bi-directional drivers. The likely range of movement in the pair dollar/ruble on Thursday is 65,60-66,35 RUB and EUR/RUB – of 76.80-77,65 RUB.
Index Mosuri will hold the current trading day within 2410-2445 points.
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Anna Kokoreva,
The Deputy Director of analytical Department,
Alpari