technical analysis

Main

• The Russian market, after a positive opening, sank against the backdrop of falling oil prices and a strengthening ruble. Despite the fact that oil prices continued to decline, the Moscow Exchange index managed to rise in the second half of trading, closing at a new two-week high.

• Following the initial weakening, the ruble recovered and mostly consolidated in a moderate plus.

• OFZ quotes interrupted a series of five growing sessions: the RGBI government bond index symbolically updated a two-month high, but then lost ground, closing with significant losses.

• Leaders: Rusagro (+6.75%), BSP ao (+5.82%), Globaltrans (+4.74%), Mechel ap (+4.6%)

• Outsiders: St. Petersburg Exchange (-8.44%), PJSC Yakovlev (-2%), Genetico (-1.98%), NKHP (-1.9%)

In detail

Russian stock market opened up today, reaching a new high since the end of October. However, it was not possible to immediately develop an upward impulse; our indices began to sag due to negative external and internal signals.

Despite the acceleration of the decline in oil prices, Russian stock indicators began to rise in the middle of trading. The Moscow Exchange index ended Tuesday at a new two-week high, the RTS index was near its highest level since December last year. True, the final plus of stock indicators was quite modest.

Currency factor in the short term continues to create obstacles to the growth of the Moscow Exchange index. However, the strengthening of the ruble has slowed down, and attempts are being made to weaken it. In addition, in general, the national currency exchange rate remains at relatively low levels, which over time only enhances the positive financial effect for many companies.

Trading volume (57.6 billion rubles) increased, but rather restrainedly, especially against the backdrop of the traditional Friday reduction in the indicator. It remains at relatively low levels, which does not yet confirm the sustainability of the growth wave that started last week.

Rusagro Papers became the growth leaders among relatively liquid stocks. Quotes updated their two-week high on the back of the news that by the second reading of the draft federal budget for 2024 and the planning period 2025–2026. amendments will be made to increase the amount of funds for the development of the domestic agro-industrial complex.

Mechel shares showed dynamics significantly better than the market. The coal mining company’s shares are technically overbought, but the fundamental case is assessed positively. Recommendation from BCS analysts “Buy” on the horizon 12 months with a target price of 640 rubles. on ordinary and preferred shares of Mechel. The company is increasing its production of coking coal.

Shares of St. Petersburg Exchange accelerated their decline and became absolute outsiders on Tuesday. Today, the trading platform announced a change in its CEO. In this regard, the exchange noted that its main and primary task is to provide investors with access to assets. After its decision, the St. Petersburg Exchange will implement a new development strategy, within the framework of which it will focus on trading in investment instruments with settlements in rubles, said the new head of the site.

Last Thursday, the US Treasury imposed sanctions against St. Petersburg Exchange. Yesterday, the site issued an explanation regarding the suspension of trading in foreign securities.

Paper Group Positive suffered moderate losses. The company published key operating and financial indicators for the third quarter and 9 months of 2023. The results for the third quarter, in our opinion, are very weak. Recommendation from BCS analysts: “Sell”.

Ruble at the start of the session the price fell sharply, but soon recovered. At the beginning of the main trading, the Russian currency again lost ground, but this impulse also did not develop, and quotes returned to a moderate plus.

The consolidation of the ruble continues for the second week. Its rate mainly plays out the dynamics of currencies on the world market in the corresponding pairs. This trend indicates that we have achieved a certain balance between the demand for foreign currency and its supply.

Oil prices have been steadily decreasing since the beginning of the day. In the middle of our trading, quotes began to attempt corrections. However, in the second half of the Russian session the fall accelerated. After our close, Brent reached $81.8 for the first time since the end of July, WTI – $77.5.

Other commodities also fell in price against the background of the active growth of the dollar. Negative factors for oil are weak statistics on the economies of large consumers of raw materials, as well as the absence of signs of a serious escalation of the conflict in the Middle East.

World stock indicators were under moderate pressure until the second half of the Russian session, after which they rushed upward. The decline in yields on US government bonds and some other large countries was positive. This reflects the easing threat of a surge in inflation that would force key central banks to stick to tight monetary policies longer. At our close, US indices added 0.2–1%, the European STOXX Europe 600 fell by 0.16%, and MSCI EM lost 0.8%.

BCS World of Investments

2023-11-07 18:27:57
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