Morning Note /
Russia

Alfa Morning Bulletin: 26 November 2021

  • Market inched higher on thin Thanksgiving volumes

  • Gains concentrated in the utilities, retail, banks and metals & mining sectors

  • Russia faces risk-off on fears over new Covid variant

Alfa
26 November 2021
Published byAlfa

Market inched higher on thin Thanksgiving volumes: Stock markets eked out small gains yesterday on low volumes with the US markets closed for Thanksgiving. Russian equities ground out a slim advance – RTSI (+0.3% @ 1,686) and IMOEX (-01% @ 3,990) – with gains concentrated in select stocks in the utilities, retail, banks and metals & mining sectors. The ruble recovering some recently lost ground (+0.3% @ 74.70). Oil prices remain flat (Brent +0.05% @ 82.82).

Russia faces risk-off on fears over new Covid variant: Russian equities have plunged into red this morning as the global market move into a risk-off mood. A new and possibly vaccine-resistant Covid variant has been detected in South Africa with cases of it also found in Botswana and Hong Kong. That has sent investors scurrying for safe haven assets like the yen, gold and the US dollar. Bets on rate hikes have retreated as Fed funds futures have rallied – the yields on 10UST have contracted sharply to 1.53% overnight. Oil prices have dropped 2.8% on the news and gold has moved back above $1,800/oz. EM assets are likely to face selling pressure as investors move to avoid risk. Gold stocks such as POLY and PLZL are likely to attract buyers seeking defensive hedges.

KEY NEWS

X5 (O/W): 9M21 interim dividends – NEUTRAL

Ex Power Machines CEO Timur Lipatov to replace Maxim Basov as Rusagro CEO – NEUTRAL-to-NEGATIVE