FORECAST: Russian Stocks Under Pressure on Doubt Over Geneva Accords

2014/04/23

MOSCOW, April 23 (RIA Novosti), Nikita Alentyev – As foreign investors return from Easter break, a boost to the Russian market by the April 17 Geneva accords has been replaced by fears the deal will not lead to a speedy resolution to the crisis in Ukraine.


Although global markets are trading in the black and Brent Crude remains relatively high, the Russian market shows no impetus for growth, and key players are becoming increasingly risk-averse. The external environment is assessed as neutral, as American indices showed moderate growth yesterday and Asian markets showed opposing principle dynamics.


During remarks in Kiev yesterday, US Vice President Joe Biden threatened Russia with international isolation and a new round of sanctions which could impact the oil, gas, and petrochemical sectors, as well as banking. The Russian market has been hit not only by the geopolitical situation in eastern Ukraine, but also by a bleak Russian Economic Ministry forecast, indicating Russia could dip into recession in the second half of the year.


With no crucial political news scheduled for today, the expectation for the Russian MICEX is limited fluctuations with no overall upward trend. Although oil prices and positive dynamics in Europe could result in a strengthening of the ruble, the Russian currency has showed no signs of appreciation, being influenced by the same factors.



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