July 2 (Finam) -- Domestic equity benchmarks turned in strong performances Wednesday amid rallying crude futures and bullishness in global indexes, with the RTS Index edging down 0.92% and the MICEX Index advancing 4.21%.
O&G plays were in hefty demand on rising black gold prices, as Gazprom spiked 6.5%, Rosneft gained 3.1% and Lukoil leapt 3.3%. Domestic banking names traded up in line with the overall market trend, with Sberbank advancing 3.6% and VTB surging 7.3%. Quite unexpectedly, MMK outperformed the steel segment, leaping 7.1%, while NLMK added a modest 0.6% and Severstal also close 0.6% higher.
US equity benchmarks landed in positive territory Wednesday, although with modest gains (an average 0.5%). The market gained support from economic data, i.e. the Non-Manufacturing Business Activity Index and home sales data, which came in better than expected. Asian exchanges are mixed this morning, with gold miners seeing the strongest demand. After the release of the US mid-week inventory report crude prices crude prices fell sharply, with Brent contracts currently trading at USD 68.50 per barrel.
We think Thursday morning’s news flow is unfavorable for the Russian stock market. A downturn in US index futures and lower crude could put pressure on the market. Sell-offs could be seen in O&G names at the open, while Polyus Gold and Polymetal could outperform on rising gold prices. A batch of macroeconomic data capable of driving the market are due out today. Specifically, ECB’s rate decision is to be made public at 3.45 pm Moscow time and market players anticipate the European Central Bank to hold the rate steady. Unemployment data from the Eurozone and the US jobs report are also due out today. |
