Yesterday, the negative sentiments in the world markets increased again. The central event of the day yesterday was the end of the two-day meeting of the Fed. As a result, it was announced that the range of the key rate was increased by 75 bp to 3% -3.25%, which was generally expected. However, the regulator has clearly indicated that its focus is only on inflationary risks and that it proceeds from the appropriateness of further progressive rate hikes. And noticeably, by 0.8% -1%, he raised the benchmarks for the rate at the end of this and next year (to 4.4% and 4.6%), which led to an outstripping growth of UST yields in the middle part of the curve, – yield 2 -x summer UST rose above 4% per annum. At the same time, the Fed also worsened its expectations for the economy: the forecast for GDP growth for the current and next years was lowered from 1.7% y / y to 0.2% y / y and 1.2% y / y, respectively, and the forecast levels inflation rates were raised by 0.2% to 5.4% y/y and 2.8% y/y respectively. As a result, inversion intensified on the 2y-10-year section of the US Treasury bond curve – the yield on 10-year UST, which reflects economic rather than interest rate risks, remained at the level of 3.55%. Against this background, the markets of emerging (EM: -1.5%) and developed (MSCI World: -1.5%) countries returned to a friendly decline, retreating, the first – to the lows since June 2020, the second – to the levels of the lows of the middle of this summer. Note that European stock indices, which completed trading before the announcement of the Fed’s decisions, were able to show moderate growth, while key US indices fell by 1.7% – 1.8% and fell to July lows, driven by the most sensitive to rate hikes and weakening economic activity of hi-tech, financial institutions and commodity sectors.
This morning, the negative mood in foreign markets persists. Thus, the key Asian indices are mainly declining, although only the Australian and Japanese markets suffer significant losses. In a small “minus” – futures for US and European indices. But commodity prices are trying to rebound, although so far not very convincing. We believe that the Fed’s meeting as a whole won back, despite the continued growth of “short” UST. And today the markets may try to move towards consolidation in anticipation of tomorrow’s publication of PMI in Europe and the US.
On Wednesday, against the backdrop of news of a partial mobilization, sellers again dominated the stock market. after opening, it lost almost 10%, coming close to the level of 2000 points for the first time since February, but then rebounded, reducing losses to 3.8% by the end of the day.
Consumer sector shares were under strong pressure (FixPrice (MCX:): -7.4%; X5 (MCX:): -7.4%; Magnit (MCX:): -6.1%; Detsky Mir: -6% ), as well as the IT sector (VK (MCX:): -9.2%; OZON (MCX:): -6.8%), which recently showed growth outstripping the market.
The oil and gas sector was declining, but the pace of falling stocks within the sector was uneven. Losses in securities of Gazprom (MCX:) (-3.2%) and LUKOIL (MCX:) (-2.5%), supported by investors’ expectations for dividend payments, were more modest than those of other representatives of the sector (Tatneft (MCX :): -8.1%; Gazprom Neft (MCX:): -6.1%; Bashneft up (MCX:): -7.3%; Rosneft (MCX:): -5.6%). Shares of state-owned banks also fell along with the market (Sberbank (MCX:): -3.9%; VTB (MCX:): -5.5%), although by the end of the day they also won back part of the losses. The wave of sales did not bypass the metallurgical companies, which also came under pressure from world prices in the commodity markets. Among the steelmakers, NLMK (MCX:) (-7.7%) was the underdog, while losses of MMK (MCX:) (-3.7%) and Severstal (MCX:) (-3.8%) were more restrained. Polyus (MCX:) (-5.8%) report released yesterday turned out to be quite good, given the restrictions on imports from Russia to Western countries, but it did not support the paper. The decline in receipts from Polymetal (MCX:) (-9.1%) was more pronounced. At the end of the day, only a few securities showed growth (Aircraft: +3.1%; Cherkizovo (MCX:): +1.2%; VSMPO-Avisma (MCX:): +0.9%).
Today, the degree of nervousness in the Russian market may decrease, but there are still few factors to activate purchases on the market. Support, however, may be provided by investors’ expectations for the early approval of Gazprom’s dividends by shareholders. The range of 2100-2200 points may remain relevant for the Moscow Exchange index today.