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Probably a lull in the market Stock Trader’s Diary


Change of indices for the week:
RTS Index: 1678.57 (+ 1.9%)
Moc Index Exchange: 3841.53 (+ 2.0%)
Dollar to ruble rate: 72.13 (-0.9%)
Brent crude: 72.64 (+ 1.4%)
DOW JONES Index: 34438.50 (-0.9%)

• The main event of the past week was the decision of the Central Bank of the Russian Federation to raise the key rate by 0.5 pp to 5.5%. The motivation for the decision is clear: inflation in May in Russia amounted to 6.05%, exceeding the inflation target of 4%. The consequence of the Central Bank’s decision was short-term pressure on the ruble / dollar exchange rate. At the same time, stock quotes did not react. And bond quotes, in general, played in the opposite direction – increased. Such dynamics suggests that the decision of our regulator was already in the prices.
• The surge in inflation to a 13-year high was also recorded in the United States. In May it was 5%, more (5.4%) was only in August 2008. Food inflation was 2.2%, energy prices increased by 28.5% over the year, and used cars and trucks rose by almost 30%. Only medical supplies fell in price – by 1.9%.
• Indices on global exchanges near their historic highs. Investors expect that the Fed will maintain its stimulating policy at its meeting, the results of which will be announced on Wednesday.
• ECB echoes FRS. “The eurozone economy is at a tipping point, but its recovery must be sustained before the European Central Bank can discuss lifting emergency support,” said ECB President Christine Lagarde.
• Japan’s Nikkei is up 0.35% on Monday, while Asian stocks were limited today as the region’s largest markets China, Hong Kong and Australia are closed for the holidays.
• Oil prices continued their three-week rise on Monday. This trend is facilitated by an increase in forecasts of demand for fuel, against the background of the lifting of travel restrictions, with a limited supply of oil on the market.
• In recent days, mining and energy companies have remained the leaders in global markets, and bank quotes have been declining.
• On Monday, the most likely scenario on the Moscow Exchange is a moderately optimistic scenario, with reduced exchange turnover.
• At the same time, the Russian market is on the eve of a surge in volatility, which is inevitable after the meeting between Putin and Biden on Wednesday.

news

• Russian imports are growing faster than exports. Kommersant …
• Rosseti is preparing to increase the volume of investments by more than 30% in the next decade, mainly through the construction of networks for the BAM and Transsib, follows from the long-term development program of the state holding. With the current regulation, the company’s debt burden will grow significantly, and profits will decline. Kommersant …
• Most Russians do not save money. Kommersant …
• Coal for the Russian energy sector continues to rise in price even in summer. This is happening against the backdrop of active exports to Asian and European countries, where high prices have been established in the context of high demand for fuel. Kommersant …
• The rate of attracting new clients by brokers in May decreased to a minimum. Kommersant …

Recommendations

• Day traders / speculators: from purchases of futures on the RTS index.
• Positionally: buying shares in retailers, oil and metallurgical companies.
• 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, KAMAZ.

RTS and MICEX indices.
Dow Jones Index.

Technical analysis prepared in XTick Professional system.



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