Stock market day is reduced by the fall of China, the ruble grows on oil

Stock market day is reduced by the fall of China, the ruble grows on oil

The dollar calculations “tomorrow” was 73,15 ruble, Euro – ruble 79,95. The MICEX index to 13:14 GMT decreased to 1739 points, the RTS index – up to 748 points.

MOSCOW, 4 Jan. Dmitry Mayorov. The ruble fluctuates slightly up, having lost part of the morning growth on the background of the contradictory dynamics of oil, the stock market of the Russian Federation is reduced due to the falling stock markets in Asia and primarily the Chinese.

Low market activity due to the ongoing in Russia new year and Christmas holidays.

The MICEX index to 13:14 GMT decreased by 1.3% to 1739 points, the RTS index — by 1.2% to 748 points.

In leaders of decrease – papers VTB (-2.5 per cent), preferred shares of Sberbank (is -3.5%).

In leaders of growth – actions “inter RAO” (+4,9%) and “Akron” (+2,8%), PhosAgro (+1%). Paper fertilizer producers continue to benefit from an expensive dollar.

The dollar calculations “tomorrow” by 13:15 Moscow time has decreased on 0,44 ruble — to 73,15 ruble, the Euro — 0.48 79,95 ruble to ruble, follows from the data of the Moscow exchange.

Since morning the dollar fell to of 72.80 ruble, Euro – ruble up to 79,26.

Trading volume in dollars does not exceed 550 million dollars, which is very small compared with average daily turnover of 3-5 billion before the holidays.

Oil and China — key milestones

The price of oil earlier in the year jumped above $ 38 per barrel of Brent to highs from mid-December 2015. The main reason for the jump in oil was to break up Saudi Arabia on Sunday, diplomatic relations with Iran.

Both countries are members of OPEC, producing about a third of the world’s oil. The sharp deterioration of relations between the two key middle East oil producing countries may delay further decline in oil prices prevailing in recent times due to expected growth of demand in the market from Iran.

However, after growth in the area is 38 dollars of oil did not gain a foothold at this level and ramped up to 37 dollars, which put pressure on the ruble, and he lost part of the morning gains. However, oil continues to remain in the corridor 37-38 dollars supporting the ruble.

Another factor, more important for the stock market, RF is the collapse of the Chinese stock market, which exceeded 7% in the Shanghai CSI 300 index. The reason for this sudden collapse, adviseo on global equity markets, including the Russian, were new fears of a slowdown in the Chinese economy.

The index of business activity in the manufacturing sector of China, calculated by the Agency Caixin, fell in December 2015 to 48.2 from 48.6 points last month, while analysts expected it at the level of 48.9 per item. The indicator value is below the key mark of 50 points testifies to decline in industrial sector.

Against this background, the Central Bank of China on Monday has weakened the reference rate for the Chinese currency, and the dollar exceeded the level of 6.6 yuan for the first time since the end of 2010, which is also a mild negative for emerging market currencies, including the ruble.

In General, the exchange trades are inactive, which is logical against the background of continuing long weekend in Russia.

Forecasts and recommendations

Severance of diplomatic relations between the two largest oil producers in OPEC, Saudi Arabia and Iran, has supported oil prices amid rising geopolitical tensions in the middle East, estimates Sergei Kochergin from the Exness group of companies.

“In the short term, the price of a barrel of Brent crude may test the level of 39,5 USD per barrel, the Russian currency strengthened to 71.6-72.3 per ruble for dollar” — he expects.

Bank of China is aggressively pursuing a course to reduce the national currency, which fits into a global trend (Japan, Kazakhstan, Brazil), says Andrei Vernikov of “Zerich capital Management”.

“Whether the currency wars (the artificial devaluation of the national currency to support exporters – ed.) is relevant again this year? In this situation, I’m not sure that the dollar in 2016 will be strong, and the fed will continue to move towards raising interest rates,” he says, speaking of exchange rates.

As for the stock market of the Russian Federation, the only real driver of growth for the MICEX index in January – the weakening of the ruble, evaluates Vernikov. Oil prices jumped up, but while they are below 40 dollars, this is not an uptrend, but only the Mirage of an uptrend, the analyst added.