Konstantin Tserazov: “Market dynamics will be determined by the decisions of central banks”

2023-12-12 12:08:16 Время чтения 12 мин 369

The Moscow Exchange index ended the last week from December 4 to 8 with a decrease of 2%, falling to 3079 points, the RTS index lost by 3.7%, reaching 1054 points.

What to pay attention to this week and what expectations reign in the market — former senior vice president of Otkritie Bank, economist Konstantin Tserazov, tells us in our interview.

According to the results of the trading session on Monday, the Moscow Exchange index fell by 0.9%, to 3114 points, the RTS index lost 1.7%, dropping to 1076 points. The growth leader on Monday was shares of Polymetal. The securities grew in anticipation of the results of the shareholders meeting, which is scheduled to open on December 8. At this event, the mechanism for exchanging securities for shares issued in Kazakhstan will be discussed. Moscow Exchange securities showed growth in the trading volume report: in November 2023, the total trading volume on the exchange markets amounted to 126.1 trillion rubles, 1.7 times more compared to November 2022. The trading volume on the stock market increased to RUB 4,683.8 billion. versus RUB 3,169.5 billion. a year ago. The opening of the trading week was marked by a fall in oil prices; against this background, Russian indices closedundefined Monday decline. The question remains open for investors whether OPEC+ countries will be able to adhere to their voluntary commitments to reduce production. In addition, fears of a slowing Chinese economy weigh on investor sentiment. These factors drove oil prices to levels of $78-79 per barrel of Brent, explains Konstantin Tserazov. In the second half of the day, the indices added negativity to the opening of the American market in negative territory.

In general, according to Konstantin Tserazov, the main factors influencing market dynamics remained the weakness of oil prices and negative conditions on foreign markets. At the same time, the weakening of the ruble and corporate news kept the Moscow Exchange index from a deeper correction.

On Tuesday, the Russian market, against the backdrop of mixed signals from external markets, ended the day with multidirectional dynamics. The positive thing was the increase in oil prices and the weakening of the ruble — according to the results of trading, the Moscow Exchange ruble index added 0.5% and rose to 3129 points, undefined The RTS dollar index lost 1%, weakening to 1066 points. As expected, the leaders were shares of oil companies — Rosneft, Lukoil and Tantneft added more than 1%. The securities of Sberbank, NCSP and Sovcomflot were also in demand.

Konstantin Vladimirovich Tserazov: «This week, investors’ attention will be focused on the regulators’ decisions on the rate. At the beginning of the week, December 12, the US Federal Reserve will open its meeting. Investors expect the agency to keep the rate at 5.25%-5.50%. The opening of the ECB meeting will take place on Thursday, December 14, investors also do not expect a change in the rate. The Bank of Russia will hold a meeting on Friday, December 15. Investors are inclined to believe that the regulator may raise the rate by 100 bp, to 16%.»

On Wednesday, the market, despite the weakening of the ruble, returned to downward dynamics — the driver of the decline was another drop in oil prices. Against the backdrop of declining demand in Europe and China, oil fell below $76 per barrel of Brent. Central event undefined for the Russian market on Wednesday were the results of the Investor Day held by Sberbank. At the event, Sberbank presented its strategy for 2024-2026, stating that it plans to increase profits and dividends. The bank confirmed that it maintains the principle of paying dividends in the amount of 50% of net profit. At the same time, Sberbank intends to comply with the capital adequacy condition at the level of 13.3%, which will require additional addition of reserves. The results of the Investor Day disappointed investors who expected that the bank might announce an increase in dividend payments, and Sberbank shares declined during the trading session. At the end of Wednesday’s trading session, the Moscow Exchange index fell by 1.6% to 3,079 points, the RTS index lost 2%, falling to 1,045 points.

Against the background of unfavorable external conditions, on Thursday the Moscow Exchange index fell by 0.2% to 3073 points, and the RTS index increased by 0.6% to 1051 points. The provider of positivity was Gazprom, whose shares rose by 2.5% during the investment event taking place in Moscow. undefined forum «Russia is calling!» Deputy Chairman of the Board of Gazprom Famil Sadygov said that changes in Gazprom’s debt ratios should not affect the recommendations of the corporation’s management on dividends. At the same time, the prospects for Gazprom’s dividends remain uncertain.

The sanctions risks were also reminded again — the G7 countries decided to ban direct imports of Russian diamonds from January 1, and indirect imports will also be prohibited from March 1 to September 1. True, ALROSA shares did not succumb to correction on this news — the company is already working on reorienting exports to other countries, explained Konstantin Tserazov.

The market ended Friday’s trading in positive territory thanks to a rebound in oil prices to $76 per barrel of Brent. At the end of the session, the Moscow Exchange index rose by 0.2% to 3080 points, the RTS index strengthened by 0.5% to 1056 points. Investors’ attention was focused on important November labor market statistics from the United States, which showed an increase in the number of jobs outside undefined agriculture by 199 thousand against expectations of growth by 180 thousand, and a decrease in unemployment to 3.7%, while experts expected the indicator to remain at 3.9%. Strong statistics could become a signal for the US Federal Reserve to postpone the start of the rate cut cycle, Konstantin Tserazov points out.

This week, investors’ attention will be focused on the regulators’ decisions on the rate. At the beginning of the week, December 12, the US Federal Reserve will open its meeting. Investors expect the agency to keep the rate at 5.25%-5.50%. The opening of the ECB meeting will take place on Thursday, December 14, investors also do not expect a change in the rate. The Bank of Russia will hold a meeting on Friday, December 15. Investors are inclined to believe that the regulator may raise the rate by 100 bp, to 16%. Among the corporate events on the Russian market, Konstantin Tserazov recommends that investors pay attention to the release on Tuesday of Sistema’s IFRS report for the third quarter and the publication of operating results undefined Aeroflot for November 2023. In addition, a meeting of the Gazprom Neft Board of Directors will be held on Tuesday. On Thursday there will be a direct line and a press conference by Russian President V.V. Putin, extraordinary meetings of shareholders of the companies PhosAgro, RUSAL, UAC, TGK-1, Gazprom will be held. On Friday, the annual general meetings of shareholders of Cian and Etalon Group will be held, as well as an extraordinary meeting of shareholders of Gazprom Neft.

Among macroeconomic statistics, the November data on retail sales and industrial production in the US, the publication of preliminary December industrial production indices for Europe and the US, as well as macroeconomic statistics for China for November are of interest.

«This week, the most likely scenario is sideways movement and reduced activity — market dynamics will be determined by decisions of central banks, the Russian market will be pressured by a possible strengthening of the ruble and restraining factors for oil growth, in particular weak data on Chinese oil imports, as well as growth undefined inventories in the US and weak industrial activity in Europe. At the same time, although the Russian market has no reason to grow this week, a slight rebound is possible at the end of the month. I believe that the market will spend the remaining time until the end of the year in consolidation, being in the range of 3000-3150 points,» predicts former senior vice president of Otkritie Bank Konstantin Tserazov.