iMoEx Cannot Accumulate Enough Power of Buying and Stuck in the Losing Streak

MoEx index is in the unstoppable losing streak. Today, on Dec 6, it lost 1.716% trading at 3088 points.

The technically bearish picture has not changed. MoEx index dropped to the lower boundary of the sideways corridor of the recent months, which is located within the area of 2985–3020 points. If there are no additional negative market-wide factors, we can assume that as we approach these levels, the volume of total share bids will begin to increase — either gradually or abruptly.

For the market sentiment to change, iMoEx has to return above 3240 points, but this scenario looks unlikely in the coming trading sessions. For reliable change of sentiment, most likely, a confident rebound in the set of first tier commodity prices, particularly oil, is also expected. It should also be noted that one of the pressure factors is the potential rise in the key rate at the December meeting of the Central Bank of Russia. The financial, metallurgical and power sectors have been the biggest losers in the Russian stock market so far.

Interestingly, about 60 non-resident participants from “friendly” countries have already been admitted to trading on the currency and derivatives market of the Moscow Exchange under the new law providing for the admission of foreign players to participate in Russian organized currency trading. About 40 more participants are in the process of obtaining admission to such trading. They may be the main force behind a new wave of ruble weakening.