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July 24 (Finam) -- On Wednesday Russian stock indices kicked off to the upside on the back of a bullish US stock market, only to give up the gains intraday under pressure from falling oil prices. As a result, the markets closed in the red, with the RTS index sagging 0.55% and the MICEX index losing 0.19%.
Domestic bank shares outperformed the market on a statement by Deutsche Bank analysts that write-downs in the US financial sector have reached the bottom: VTB gained 0.7% and Sberbank advanced 2.08%. A pullback in oil futures and the imposition of record-high export duties on oil as of August 1 sparked off a sell-off in the oil & gas sector: with Lukoil easing down 0.37%, Gazprom losing 1.36% and Rosneft closing out 0.24% lower. Steel names were back in vogue with investors after a downturn in the previous several trade sessions: NLMK climbed 2.35%, Severstal gained 0.21% and MMK inched up 0.06%. The Polymetal company saw its market cap climb by 3.36% on the publication of its robust production indices.
US stock indices locked in gains on Wednesday on another retreat in oil prices and the promotion of a plan at legislative level to rescue the largest mortgage companies in the US. As a consequence, financial plays enjoyed strong demand on the part of investors. Asian markets are largely on the rise today, with automotive shares leading growth. Oil futures have extended losses, and are now hovering around USD 125 per barrel. Futures on nonferrous metals are also trading down against the backdrop of the strengthening US dollar.
We view this morning's news flow as neutral for the Russian stock market. Domestic banking plays may gain on strong investor demand for financial sector shares. Oil & gas plays will likely remain under pressure from easing oil prices and the imminent imposition of high export duties on oil. Metal makers will likely trade in synch with the market. |
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