The Russian stock market: New sanctions topple stock

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The Russian stock market opened with sales. To date, the leading stock indexes are retreating on average by 0.7%, the list of outsiders of stocks of “Bashneft” and “Tape”. Positive traded securities of companies such as RussNeft and MMK.
During the day of the meeting of the Board of Directors will hold a “ALROSA” and “IDGC of Siberia”. TGC-1 publishes IFRS financial statements for 9 months of 2018. GK “Cherkizovo” will present operating results for October this year.
The external environment for today’s session was not the most prosperous. US markets ended Thursday a small fall. Index futures S&P premarket lose weight. Morning Asia, by the way, was kept in the “red” zone. Oil prices continue to fall and are critically close to the August lows. A barrel of Brent is $70,6. The whole range of fundamental news remains in favor of bears, but the raw material is very oversold and likely to bounce up soon.
A note of negativity in the Russian auction made the news about sanctions against Crimean resorts and a number of organizations. American citizens and legal persons are prohibited to conduct business with these organizations, their property in the U.S. will be frozen. However, we doubt that the sanatorium “Mishor”, “AI-Petri”, “Dulber”, as well as the resort Yalta Mriya Resort have property in the States. There is none of the Crimean CHP. The purpose of sanctions is very strange, because the main investments go to the Crimea with mainland Russia, the main flow of tourists provide the citizens of Russia. Probably most importantly for the United States to create the appearance of anti-Russian activities. As you know, the new restrictions would have no impact on the economy and development of the region.
The Euro/dollar on Friday morning, moving in a short-term descending channel and is trading around of 1.1350. The Federal reserve completed before the next meeting and kept its benchmark interest rate in the target range of 2.00 to 2.25% per annum, indicating that a new monetary decisions will be taken in accordance with the state of the employment market and the inflation trend.
Both of these options, of course, allow you to raise the interest rate at the December meeting. It is interesting that the FOMC members are discussing the dynamics of macro data of the U.S., has avoided the topic of a trade war with China. As shown by the financial statements, a number of industrial companies are already experiencing the negative effects from the actions of their own government. Apparently, the Federal Reserve does not consider this fact to be significant.
The resumption of growth of the US dollar along with the fall in oil prices has negatively affected dynamics of the Russian currency. The ruble in early trading cheaper in a basket of currencies. For one US dollar at the exchange to date suggest 66,86 RUB, EUR – RUB 75,7 Likely trading range for today in a pair dollar/ruble is 66.5-67,45 RUB and EUR/RUB – 75,60-76,50 RUB.
Statistics published today from UK will publish the GDP growth rate in the third quarter, production in the manufacturing sector and trade balance. The U.S. will be published producer price index.
Index Mosberg today will be forced to consider new nuances of the package of anti-Russian sanctions, but nothing critical and dangerous did not happen – this is all very expected. It’s also possible, works the factor of Friday and the market will prefer to fix positions before the weekend. Ruble indicator protorguetsya today in the range 2400-2440 points.
Anna Kokoreva,
The Deputy Director of analytical Department,