Russian equities posted gains on Tuesday on the heels of an upturn in crude futures, with the RTS Index adding 1.11% and the MICEX Index advancing 0.87%.
O&G names took their cue from the oil market, as Gazprom edged up 0.8%, Rosneft rose 0.6% and Lukoil closed 1.3% higher. In the financial segment, Sberbank saw strong demand, up 2.7%, while Bank VTB advanced 0.7%. Steels trended in stride with the market, with Severstal climbing 1.4%, NLMK inching up 0.4% and MMK jumping 0.5%. Uralkali plunged 5.6% on news the government mulls introducing export duties on potash chloride.
US benchmarks saw moderate gains on Tuesday. The market gained support from news Greece is prepared to take firm measures to tackle its budget deficit. Asian markets are higher on this news today. After Tuesday’s rally crude futures corrected slightly down, with Brent trading around USD 78/bbl.
According to our estimates, Wednesday morning's news flow looks largely unfavorable for the Russian stock market. A pullback in US index futures and retreating oil prices will put pressure on the market, including O&G plays. With gold rising, gold miners could slightly outperform today. EU retail sales numbers due out later could impact market sentiment. The release of the US mid-week inventory report is an important event for the petroleum market.
