Russian stock market daily evening report (July 29, 2015, Wednesday)

Stocks

Market today. The Russian exchange market proceeded upwards on Wednesday at the back of the prevailing positive of the western investors and climbing ruble. Correction at the Russian market has been caused by the statement of the CBR on temporary suspension of currency buying in the favor of the reserves filling. Ruble strengthening allowed breaking through 60 RUB/USD and reach close to 59. The given factor was the reason of chemical and metal names’ dip, which looked better than the market: NLMK (-2.8%), MMK (-1.8%), Akron (-3.8%) and PhosAgro (-1%).

The posted stats on the oil and oil products’ reserves in the US by Ministry of Energy indicated reduction of the oil reserves by 4.2 mn bbl while expectations of growth by 0.85 mn bbl. The given report led to strengthening of the oil by 2% in a moment to 54 USD per bbl; which has just warmed up the Russian market.

The following were the growth leaders among the blue chips: Gazprom (+2.26%) and Sberbank (+2.2%), while NOVATEK (-0.3%) and VTB (-0.25%) were the top losers. The stock of NOVATEK did not gain support from the 2Q 2015 report that showed 41.9 bn RUB as net profit while the target was 38.4 bn RUB. E.ON Russia (-3.7%) dipped significantly having showed negative RAS report for 1H 2015.

Market tomorrow. Today the investors will be focused on the decision of Fed regarding the rate. In case the rates preserve at the formed level, which is most likely to happen, the market participants will seek a benchmark for the upping start.


FX market

Market today. Wednesday the position of ruble has been supported by the statement of the Bank of Russia on suspending buying currency at the domestic market. The very purchases of currency by CBR affected the market not that seriously due to insignificant volumes and accumulating results, however, alarms of the regulator regarding growth of volatility at the currency market has cooled of the flames of the players vs the domestic currency. Besides, the currency risks might introduce corrections to the decision of CBR on the key rate at the nearest session on Friday: another round of rate reduction might not happen, which would support ruble locally.

Market tomorrow. However, generally, the markets will be focused on the results of the Fed session (to be posted tonight). In case the investors’ confidence in the soon coming rate upping by Fed grows, the American currency will regain the positions above 60 RUB fast.

Contributed by Veles Capital