The Russian stock market may continue to rebound when oil reverses from $80

Alexey Antonov, ALOR BROKER 18 November 2021 10:57

The Russian stock market yesterday tried to bounce off the lower boundary of the ascending channel, adding 0.7% following the results of the main session. It seems that the result is not bad, but it was caused mainly by the growth of the heavyweight Gazprom by 3.9%. Traders reacted with such powerful purchases to the rising cost of gas and the statement of the German authorities that the suspension of certification of Nord Stream 2 is purely technical, not political. The paper can continue to grow today. The resistance is the area of 366 rubles .

Sberbank is also trying to turn around from the 325-335 rub support zone. We consider the shares of this issuer to be among the best on the Russian market, but a significant part of them belongs to non-residents, who always react very sharply to the aggravation of the political background, especially now when they have a good profit, which is a pity to lose.

Today, the external background looks neutral. US futures are growing weakly after yesterday's slight decline, but at the same time oil is falling by 0.4%, testing the $80 per barrel mark from top to bottom. It is the cheaper oil that will hinder the development of a full-fledged rebound of the Moscow Stock Exchange Index.

However, we do not see any reasons for the decline in quotations of "black gold". The shortage of fuel in the world is indicated by high gas prices exceeding $ 1,100 per thousand cubic meters. While there are high hopes that the $80 mark will stand, there will be an upward reversal from it, which will support the stock market.

However, in general, the situation on the Russian stock market looks alarming. In the course of trading, it is clear that buyers are weak now, there are no internal reasons for growth. On the contrary, Rosstat recorded an acceleration in inflation growth after a slight decline caused by a lockdown in early November. Thus, there is no doubt that the Bank of Russia will continue to aggressively raise the key rate, which is always negative for the stock market.

The American stock market also looks technically overbought, where a correction is also possible in the near future. So it is worth refraining from new medium-term purchases of shares for the time being. The exception is the securities of gold miners, since gold continues to rise in price, albeit slowly.

Expectations of a rate hike and some fading of political attacks on Russia caused the ruble to strengthen by 0.6% yesterday. The dollar-ruble pair failed to gain a foothold above the 73 mark, opening its way to the 74.7 area. This morning, the ruble is getting more expensive against the dollar by a symbolic 0.1%.

In the near future, the Russian currency will be supported by the tax period, but it is very risky to bet on the strengthening of the ruble, with a high probability we will meet the end of the year with a lower ruble exchange rate.

Alexey Antonov, Chief Analyst at ALOR BROKER 

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