Stock market review for February 1, 2021: plunging into a correction

Negative dynamics prevailed. The 20 most liquid stocks closed lower. The Moscow Exchange Index fell to its lowest level since December 30, to its 50-day moving average. The PIK shares (PIKK 705.0, +4,15%) were the leaders among the most liquid stocks. Outsiders became (NVTK 1266,5, -4,50%). USD/RUB dropped below 76.

(GMKN 24,520, -2,81%) published its production reports. Despite reserving environmental requirements, the company is able to present successful financial results. Average annual platinum prices were higher than in 2019, with palladium prices reaching a record high. In addition, the price of copper rose significantly and nickel prices recovered. The consensus forecast assumes revenues in excess of $6.5 billion with EBITDA of about $1.5 billion and earnings in the neighborhood of $550 million. Debt will remain at levels at which MMC can maintain its dividend. Target on the stock is 28.8K, which corresponds to 17% upside potential excluding dividends.

The stock market is sinking into a correction. Investors do not make attempts to buy back the main securities. Significant support levels in most "blue chips" are not observed yet. It is possible market decline by 2.5% during the week, after which buying will begin. Driver of decrease is negative dynamics on American market.

(CHMF 1,263.6, -1.22%), spec. buy, target: 1,350 rubles. From the technical point of view, the rebound to the resistance level near 1,370 rubles is likely. Financial statements could be the growth driver.

We expect a decline within 1%. A rebound is likely on the U.S. market. USD/RUB pair will tentatively fluctuate in the range of 75.00-76.00. Mosbirch index will spend the day in the range of 3250-3300 points.