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A landslide drop in OFZ quotes


• A wave of correction has hit the global stock markets. The RTS and IMOEX indices again dropped below their significant support / resistance levels in the zones of 1500 and 3500 points, respectively. However, the Russian market remains in the medium-term growth channel. The indices are now at its lower border.
• The reason for the pessimism was the news that Germany extended the quarantine until mid-April, as well as Norway postponed the plan to resume the normal rhythm indefinitely. France reintroduced quarantine a week earlier. In Asia, the problem countries are India, Indonesia and the Philippines, where coronavirus infection is not slowing down. Experts say that the new strain of coronavirus is more contagious.
• Heightened fears US Treasury Secretary Janet Yellen, who said at a Senate hearing that the US economy remains in crisis due to the pandemic. At the same time, she supported the plan to increase taxes to finance the increased government spending.
• China’s blue-chip index CSI300 is down 1.6% today to hit its three-month low. At the same time, the sectoral index of Chinese commodity companies fell 4.2%, the transport index lost 4%, the financial sector fell 1.2%, and the real estate index fell 2.2%.
• Uncertainty about the resumption of business activity has led to a decline in fuel and energy prices. Prices for industrial and rare earth metals also fell.
• Against this background, a rapid flow of capital into the dollar and dollar-denominated fixed income assets began, which led to the strengthening of the American currency, and intensified the downward trend in commodity prices, and also put pressure on the currencies of developing countries, and on the quotations of shares of companies on stock exchanges developing countries.
• Russia did not stand aside. The government bond index (see RGBI chart) collapsed. In addition to the general trend of investor flight from emerging markets, rumors are spreading that this week the US President Biden’s administration will announce new sanctions against the Russian national debt. It got to the point that the Central Bank was unable to place the next issue of treasury bonds of the Central Bank (KOBR) “due to the lack of applications.” See Vedomosti … Kommersant …

News.

• Gazprom will build two new LNG plants for $ 4.3 billion. Vedomosti …
• The government is considering the option of an additional issue of Gazprom shares to finance the gasification of the regions. Vedomosti …
• KAMAZ has increased its market share. Kommersant …
• The Bank of Russia is discussing with the Moscow Exchange a mechanism to prevent attacks on low-liquid shares. It is proposed to temporarily transfer such shares to a list available only to qualified investors. Kommersant …
• The International Football Federation (FIFA), for the first time in its history, received its main income in a year from electronic games. Kommersant …

Recommendations

• Day traders / speculators: Out of the market.
• Positionally: Sell Mechel shares, buy UAC shares.
• For long-term investment purposes, purchase
Bonds: issues 52001, * 002, * 003, 26225, * 233, * 235, * 236, 46020.
Shares: Polymetal, Severstal, MMK, NLMK, RusAl, Acron, PhosAgro, VSMPO Avisma, Moscow Exchange, Yandex, Mail.ru, AFK Sistema, Surgutneftegaz, Surgutneftegaz prev., NOVATEK, Magnit, Lenta, Gazpromneft, Petropavlovsk (POGR) Mosenergo, RusGiro, Unipro, InterRAO, Rostelecom.


Dow Jones Index.

Technical analysis prepared in the XTick Professional system.

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