Stock Market Outlook for December 15, 2020: OPEC threw the market off balance
The market on the eve of
The trading dynamics were multidirectional. Moscow Exchange Index The RTS stock market has been growing, with the RTS falling below the psychologically significant level of 1,400 points. VSMPO shares (VSMO 21,080, +6.36%) were the leaders. Mechel (MTLRP 73.50, -4,92%) also shed its prefs after rising the day before. The USD/RUB pair traded in the 72.90-73.90 range as oil fell below $50 per barrel.
Market and company news
OPEC adjusted its market estimate. The estimate of production cuts in non-OPEC countries was revised down by less than 0.1 million barrels per day, to 2.5 million. This factor contributed to the oil price bounce after its sharp correction on the news of uncertainty over Brexit and a tough quarantine in Germany for Christmas and New Year.
We believe that the EU and the UK have a high chance of agreeing on future agreements, if not before the end of the year, then in the first quarter of next year. The quarantine will also have a limited impact on hydrocarbon consumption, as large consumers will not stop working. We expect the oil price to hold near $50 per barrel Brent.
Trade ideas
Qiwi plc (QIWI 799, -2.68), spec. purchase, target: 1,000 rubles. We believe that the restrictions on individual transactions will not have a devastating effect on the transfer service. A reduction in the annual dividend is also unlikely.
Expectations
We expect mixed dynamics. There are no important events in focus. Benchmark for the Mosbirch Index: 3230-3280 points range. The pair USD/RUB will trade between 72.9 and 73.7.
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