What happened in the world of finance in a week # 19

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Currency and commodity markets

The past week began with the strengthening of the ruble - for the first time since November 2014, the exchange rate of the euro fell below the 61 ruble mark. At the same time, the dollar fell to 55.15 rubles, and on Tuesday, April 7, for the first time in 2015, it struck a mark of 55 rubles.

By the end of the week, the exchange rate of the euro fell below 55 rubles, and the dollar exchange rate fell below 51 rubles (however, the dollar then won back the losses, which was promoted by the Central Bank ’s decision to raise rates on currency auctions.).

At the beginning of the week, the cost of a barrel of Brent exceeded $ 58, but on Friday at the London ICE Futures Exchange, the May futures for Brent crude traded at $ 56.42 a barrel.



The chief economist of ITinvest Sergey Egishyants described in his weekly review the situation on the energy market and how it can develop in the future:

We are discussing oil - there are a lot of questions and panicky opinions about this: their authors should read the ancient discourses of Soros on the “reflexivity” of speculative markets - these have recently been joined by commodity ones. Due to the crowding out of large banks, broad masses remained there, and their motto is simple - “tomorrow will be like today”: therefore, in the markets either stupid sediment with purchases and sales at the edges of the range, or when finally the borders are broken through according to fundamental reasons, stupid recoilless trend - leading prices away from the values ​​justified by these resonances. As in our case: the supply of oil has increased in Pushcha due to shale fever in the United States - but the amount of excess (only 1-2% of total consumption) does not justify a 2.5-fold price collapse in six months. In short, there was an obvious “flight” on the market, and now there is a need for a rebound up: the current situation can justify 70-80 bucks a barrel - but due to this market peculiarity, the reverse “overrun” above these numbers is not excluded.

But in the 1980s, supply exceeded demand by an order of magnitude steeper than today: even then the price of Brent fell by 11 in the autumn of 1988, but already in January 1989 it reached 18 (+1.6 times), and in April - 22, t . for half a year have doubled. And after all, geopolitics was much simpler than the current one: the war of Iran and Iraq subsided in the summer of 1988, Saddam’s entry into Kuwait happened in the summer of 1990 - and the collapse of the Eastern Bloc strengthened the main consumers of oil (USA, Japan, EU), also not contributing its appreciation; but, come on, she still jumped. So it will be now - the only question is in time and trajectory: we suspect that everything will pass quickly and without new bottoms on the road, because shalers are too weak financially and at current prices will start to go bankrupt. Further, production growth will soon cease - the lag between the decline of drilling and compression output is 3-6 months, and the first process started only in December. Filled storage is a bullish factor, not a bearish factor, as it is believed: if the producer has nowhere to put oil, he will cut production, but will not sell below cost. Therefore, waiting for 70-80 in the spring and summer; Is another scenario possible? - Of course, there are a lot of different factors: but even if we fall, then we will quickly fly away, but in the end we will go even higher.

Meanwhile, the Ministry of Finance considers it unlikely to repeat the December jumps of the ruble exchange rate "even if oil prices fall by $ 10," said Russian Deputy Finance Minister Alexei Moiseyev.

ITinvest expert Vasily Oleinik, in turn, is of the opinion that the potential for strengthening the Russian currency has been exhausted in the near future:

As for the Russian currency, the potential of its strengthening has been exhausted. After 9 weeks of growth, the Russian ruble in the coming weeks will begin a smooth turn towards weakening. With the current exchange rate of the national currency, the price of oil in rubles has dropped to a minimum over the past many months and is already behind the comfortable line for the Russian budget.

Stock markets

The Russian stock market grew at the beginning of the week following the soaring oil - the RTS index updated its maximum since the end of November last year amid the ruble strengthening, the MICEX index managed to exceed 1,700 points.



Further, the MICEX index went down - on Thursday, April 9, it fell to 1,670 points (the decrease was recorded during three trading sessions in a row). The RTS index, due to the continuous growth of the ruble exchange rate, set new records , having risen above 1000 points by the end of the week.

Vasily Oleinik described the situation on the Russian stock market this way:

If at the beginning of the current year, Russian stocks were soaring upwards on the devaluation of the national currency, now we see a completely opposite situation. A strong ruble not only kills the Russian economy, but also negatively affects the MICEX ruble index. Outsiders on the stock market in such conditions are all Russian exporters. As long as commodity prices remain at the same level, ruble appreciation reduces the revenue of metallurgical and oil and gas companies. [...]

On the other hand, against the backdrop of the strengthening of the ruble, the banking sector looks good. Sberbank shares added on Thursday almost 3%. A strong ruble provides an opportunity for the central bank of the Russian Federation at the upcoming, April 30, regular meeting, to lower the key interest rate more aggressively, within 2-3%. A reduction in interest rates will lead to cheaper prices and a revival of lending, which has been almost paralyzed in recent months, so it is the banking sector that in the coming months can continue to look a little stronger than other sectors.

In general, a look at the Russian stock market, with an eye on April, we still remain negative. The Russian MICEX index is unlikely to see much higher than the 1,700 points mark in the coming weeks. After passing down the mark of 1600 points, the road to the mark 1500 will be completely open, where you can look again at the purchases. The driver to reduce the Russian market will be a correction in developed sites. The reporting season starts in America this week, which will obviously present many negative surprises to investors.

Economy: what to expect in the near future

The presenter of RBC-TV, Zhanna Nemtsova, together with Valery Weisberg, head of the analytical department at the EC “Region”, analyzed the most pressing economic topics. During the conversation, the situation in the market of metallurgists and exporters, the ruble exchange rate, the currency repo tool and its prospects, as well as the question of how to lift the embargo on the supply of Iranian oil and lower production in the United States will affect the world market.



That's all, thank you for your attention. More analytical materials from leading experts on the ITinvest website .

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Images: Tass , Reuters, Bloomberg