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Global markets may continue to fall next week

UNITED STATES (OBSERVATORY NEWS) — Following the global markets, the Russian market may continue to fall in the coming week, experts said.

On Friday, the cost of futures for Brent crude oil for delivery in May 2020 on the ICE exchange in London was reduced by more than 4% to $ 49.66 per barrel.

The last time the oil price was below $ 50 per barrel at the end of July 2017. April futures for WTI crude oil are getting cheaper by 4.5% – up to $ 44.95 per barrel, the lowest since January 2019.

The main index of the Frankfurt Stock Exchange DAX, covering the 30 largest joint-stock companies in Germany, fell by 4.07% to 11,864 points.

The Dow Jones index on Thursday dropped 4.42% to 25,766.64 points, and the Hang Seng index fell 2.42% to 26,129 points. Trading on the Milan Stock Exchange opened with the fall of the main Ftse Mib index by more than 3%, ANSA reported.

The Russian market continues to decline after the western sites, the Mosbirzhi and RTS indices as of 19:12 Moscow time fell by 4.48% and 6.24%, to 2785.08 and 1299.69 points, respectively. The Russian currency is weakening in relation to the American and European.

Thus, the dollar grows to 67.243 rubles (+ 1.86%), and the euro – to 73.96 rubles (+ 1.96%).

According to experts interviewed by TASS, further dynamics on global markets will depend on today’s closure of US exchanges and on further information regarding the spread of coronavirus.

– Weekly forecast –

Monday’s trading will depend on the results of the closure of US exchanges on Friday, analyst at Finam Group said.

“As for how they will be held on Monday, it depends on the closure of US exchanges. If they close above today’s lowest levels, there will be an opportunity for some positive dynamics, but for now it will only be a technical rebound,” the expert explained.

The fact that the Russian market is in a general global trend, says senior analyst at BCS Prime Sergey Suvorov. In addition, the situation there is even slightly worse, due to geopolitical risks, in particular tensions in Syria and the threat of new sanctions, the expert added.

In turn, the situation on world exchanges may worsen if there is an increase in the incidence of covid-19 in the United States, if this does not happen, a rebound is possible in the markets, Suvorov also explained.

Sergey Suvorov also noted that the reason for the increased reaction of the Russian market to negative is the presence of a large number of foreign players on it.

“Since the Russian market is a kind of speculative toy for foreign funds, with the onset of some negative moments, players immediately begin to fix their positions, putting additional pressure on stock quotes. If there weren’t so many foreigners in our market that make up a little more half of the bidders, the situation would probably be a little better,” he explained.

In turn, Alexander Osin, an analyst with the department of trading operations on the Russian stock market of Freedom Finance Investment Group, added that due to a downward reversal of the growing weekly trend formed back in 2018, it will be difficult for the market to recover relatively quickly.

“Next week, the chances of a new round of market decline prevail with a target range for the Moscow Exchange and the ruble to the dollar, equal to 2600-2900 points and 65-69 rubles per US dollar,” the expert explained.

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