Morning Note /

Alfa Morning Bulletin: 14 December 2021

  • No respite for Russian stocks but ruble holds firm

  • Markets retreat on Covid fears ahead central bank meetings

  • Russian equities are showing signs of finding support levels

14 December 2021
Published byAlfa

No respite for Russian stocks but ruble holds firm: There was no respite for Russian equities on Monday as the selloff intensified – RTSI (- 4.0% @ 1,548) and IMOEX (-3.8% @ 3,618) – under the cloud of geopolitical risk and margin calls. EU foreign ministers agreed to place sanctions on targets linked to the Russian private military company, Wagner, accusing it of acting to destabilize Ukraine and parts of Africa. Banks and blue chips led the selloff in Russian stocks. However, while equities are getting hammered recently by geopolitical risk and a flurry of margin calls, the ruble remains stable (-0.2% @ 73.53). This suggests that the equity selloff may be overdone. Oil prices pared gains and swung lower (Brent -1.1% @ 74.39) after the UK reported its first Omicron death amid a strong surge in the number of cases of the new variant.

Russian equities are showing signs of finding support levels: Russian equities are showing signs of having hit support levels, having been roiled by margin calls in recent sessions. A rebound looks on the cards today despite the cautious global mood on worries over the Omicron strain of Covid ahead of a slew of central bank meetings, including the Federal Reserve tomorrow, when Jerome Powell is expected to take a more hawkish stance. Oil prices are firm this morning and commodities in general are well supported, which should provide a tailwind to Russian cyclical stocks. The ruble also remains solid, reflecting a level of optimism on the geopolitical front.


VK - Vladimir Kirienko (ex-Rostelecom FVP) appointed CEO with immediate effect – NEUTRAL