Why is the ruble getting cheaper? The situation in the Russian market
As one would expect, after the global markets, the Index of the Moscow Stock exchange also went down. And although for two days the Russian stock market showed growth, now it has returned to negative values. According to experts, this result was expected after the news about the fall of European and American stock indices.
According to “Open Broker” analyst TimurNigmatullin, the main reason for sales is the uncertainty of the Chinese economy. Thus, the National Bureau of Statistics of China reported that profits of Chinese industrial companies in January-February 2019 sank by 14%, to 105.5 billion US dollars. It is worth emphasizing that these figures are the worst performance since 2011.
In addition, experts believe that we should not discount the concerns about the state of the global economy. Thus, according to the speech of the ECB President Mario Draghi, the eurozone faced a steady deterioration in foreign demand.
Why is the ruble getting cheaper? The situation on the MoscowStock exchange
By the end of the auction, the Moscow Stock Exchange lost 1% and dropped to 2488 points. The RTS currency index, following the weakening of the ruble, sank 1.9% to 1207 points. The largest losses were suffered by the shares of RussNeft, which lost 4.4% after the release of financial results for 2018. With a decline, Safmars, X5, and MTS were also closed.
Also, a significant contribution to the fall of the Moscow Stock Exchangeindex was made by the Norilsk Nickel papers. The head of the mining and smelting complex, Vladimir Potanin, will begin negotiations with Rusal to reduce dividends. Shareholders reacted negatively to the news: Norilsk Nickel fell by 3%. Paper “Rusal” decreased by 2.1%.
TransContainer increased its profit by 1.5 times in the previous year. The largest Russian rail container shipping operator for the year earned $ 9.5 billion. The company’s revenue increased by 17%. By the end of the trades, the prices went up 2.5%.
As experts say. The world economy is still showing its characteristic uncertainty, however, under these conditions, productive trade negotiations between the US and China can contribute to the optimism. At the moment, the market still has chances to win their positions, but the situation is becoming more alarming, says Veles Capital analyst Elena Kozhukhova.
The ruble fell against the dollar by 0.4%, to 64.8 rubles, while the euro fell 0.4% to 73 rubles. Experts say that experience shows that the ruble is very sensitive to China’s economic sentiment. In addition, market participants could sell rubles after the peak of the tax period and the recent meeting of the Central Bank. Negative external background also played a role, but today the currencies of developing countries have lost only 0.23%.