Market Flickers Into Life as Operators Predict Growth
- By Olga Popova
- Aug. 13 1999 00:00
Shares ended firmer Thursday after another day of lifeless trading, but while volume was low, some operators said the market could be poised for more growth.
The benchmark RTS1-Interfax share index ended 2.03 percent firmer at 104.87 on volume of just $5.1 million. It was the second day in a row that prices closed up on low volumes.
The dollar-denominated Moscow Times Index of 50 leading shares rose 2.39 percent to 80.83 on turnover of $6.11 million.
Traders said the sacking of yet another government Monday may have finally pushed the bourse as low as it can go after softening for weeks, and that growth was the only option now. "The market now looks bad enough to be good," brokerage Troika Dialog said in a Thursday report.
Shares plunged after Prime Minister Sergei Stepashin was sacked and Vladimir Putin, chief of the Federal Security Service, was appointed in his place. But they quickly rebounded to near their former levels.
"The question is whether the dramatic sell-off over the past three weeks and future concerns over interest rates have run their course. Technically, not much more air can be taken out of the Russian market," Troika said.
But not all traders agreed the market could see meaningful gains in the near future.
Alexander Fonarkov, senior trader at Regent European Securities, dismissed suggestions prices may jump if Putin is confirmed by parliament Monday.
"I don't know if it makes sense to speculate on Putin's confirmation. It looks like that outcome has already been priced in at this level," he said.
But Fonarkov did not rule out some growth as prices continued to consolidate after tumbling from 1999 highs last month.