The stock market is likely to rebound today, but the sales are not over yet

Global equity markets crashed yesterday. Europe lost 2.3-2.7%, America – 1.6-2.1%. Commodity markets fell heavily, with the exception of gold, oil plummeted by almost 7%, easily breaking through the support of $ 70 a barrel.

There were no reasons for such strong sales, it was just a logical and obligatory phase of the market – a correction. In the absence of reasons for growth, large players began to reduce their marginal positions, speculators immediately joined the outlined downward movement, and this is the result …

You can talk long and tediously about fears of a decline in the global economy due to the “third wave” of coronavirus, an increase in the risks of a faster curtailment of economic stimulus by the FRS due to growing inflation. But all these factors were at work last week.

Moreover, the turnover of trading on the Moscow Exchange was low – for the shares of the Moscow Exchange Index, they amounted to about 89 billion rubles. This is partly due to the vacation season, as well as the fact that many simply did not understand what was happening, why we were falling, and decided not to take any steps.

The external background is improving this morning. US futures are up a quarter percent, plus industrial and precious metals. Therefore, we expect a rebound in the Russian stock market at the opening of trading.

On a rebound, you can try to take ferrous metallurgists, Norilsk Nickel, Sberbank. In conditions of uncertainty and inflation risks, stocks of gold miners will not be superfluous in portfolios.

From a more medium-term perspective, it is worth taking a closer look at the oil sector: we still expect oil to hit at least $ 80 a barrel this year.

By the way, yesterday’s drop in oil was excessive. The increase in production by 400 thousand barrels per day since August, as agreed by the OPEC + countries on Sunday, did not come as a surprise to the market and was already included in the quotes.

On the contrary, reaching an agreement by the cartel makes its policy transparent for a year and a half, which allows both oil producers and medium-term investors to make plans. Therefore, this agreement is rather positive for the market.

We expect oil to return above $ 70 per barrel in the near future.

But in general, the picture on the Moscow Exchange Index is negative: the indicator has strongly broken down the ascending channel. Therefore, we do not recommend getting carried away with purchases, given the weakness of oil (at least the end of its upward trend) and the approaching Duma elections, one can expect that non-residents will continue to reduce their investments in Russian shares. The increase in the key rate of the Central Bank on Friday will greatly reduce the inflow of new funds from private investors to the stock market, and many corporate investors may begin to increase the share of bonds in their portfolios.

On yesterday’s negative, the ruble lost slightly less than 0.9% of its value against the dollar, closing at the resistance of 74.6-74.7 rubles per dollar. As the external background improves, in anticipation of the decision of the Central Bank’s Board of Directors, as well as in the coming tax period, the ruble may strengthen slightly today. But joining the movement is very risky; the Russian currency has no chances of strong growth under the conditions of the fiscal rule.

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