The Russian stock market is under pressure from the flight of investors from ruble

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Expect neutral opening of the Russian market amid a weak rise of 0.1-0.2% futures on stock indices of developed countries and the MSCI “Emerging markets”. However, Chinese indices continue to decline, approaching the level of local support in the period of one year, above which investors will increase. Prerequisites for this will serve as a continuation of the trade conflict between the US and China, the tightening policy of the fed, and as a result of sales in emerging markets.
In turn, the sale of Russian OFZs continued on Monday across the curve of the national debt, which strengthened the dollar against the ruble to 70.5. Now may be followed by temporary stabilization in anticipation of a scheduled meeting of the CBR’s monetary policy on Friday, which we expect to increase the key rate in terms of proinflationary risks.
The regulator will declare that he is monitoring the situation on world markets, and in the current environment does not see reason for immediate policy tightening. In addition, Russia has stronger data compared to the same Turkey, Argentina. However, today, the Central Bank of Argentina will hold a meeting at least a month if a decision is made on its increase, it will increase the volatility of emerging market currencies.
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Viktor Veselov,
Chief analyst,
GLOBEXBANK