The Russian stock market will continue to dive

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Expected minor decline in the Russian market at the opening of trading on the background of a decline to 0.7% in futures on global stock indices. First and foremost, the decline of Chinese indices, despite the growth of industrial production 1.b.p. to 5.9% in October and investment growth in basic capital, but weak retail sales. While investors are more concerned with issues of trade war between the US and China scheduled for late November. Pending a positive outcome of this event, emerging markets will receive support until the end of November.
But on Wednesday investors ‘ attention will focus on the performance of the U.S. fed, which may confirm the Committee’s intention to increase the upper level of interest rates in December 2018 and in 2019 in response to the growth of the economy to prevent excessive inflation. This will support the dollar in the second half of the day on Wednesday.
Against this background, the ruble will continue weakening. We also expect the continued decline of oil prices due to increasing crude oil inventories in the United States 2.8 million barrels, according to the forecast from Bloomberg, the official data which will be published on Thursday. However, in favor of the ruble can play Mexican peso, as a rising currency, which has chances to become stronger in anticipation of increasing interest rates of the Bank of Mexico on Thursday (the likelihood of which is about 77%).
Viktor Veselov,
Chief analyst,