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RTS Index may drop to 1,000 points, experts say

According to experts, the ruble-denominated MOEX Russia Index can roll back to about 2,500 points

MOSCOW, January 24. /TASS/. Russian stock indices may continue falling in the environment of continuing foreign political tensions, ruble weakness and the wave of overall market evasion of risks observed early this week, experts questioned by TASS say. According to their estimates, the dollar-denominated RTS Index can plummet to 1,000 points and the ruble-denominated MOEX Russia Index can roll back to about 2,500 points.

Russian exchange indexes retreated on Monday to December 2020 levels. The MOEX Russia Index dropped by 5.93% to 3,235.28 points. The RTS index lost 8.11% and declined to 1,288.17 points.

Experts do not rule out further falling if risks of military confrontation on the Ukrainian border materialize. The RTS can drop to 1,000-1,100 points and the target level for the MOEX Russia Index can be 2,550 points, Elena Kozhukhova from Veles Capital says.

The RTS Index can fall to 1,100-1,160 points, Finam believes.

"Investors await reports of the largest companies from the NASDAQ index and if results and quarterly targets do not match expectations, the market correction will continue. The technical picture is negative. The downward trend is not reversed, increasing the probability of correction continuation," Georgy Vaschenko from Freedom Finance says.

A report on agreement signing among Russia, the US and NATO will be enough to completely reverse the market situation and in such case we will see record-breaking rates of RTS Index decline and growth, Artyom Tuzov from Univer Capital says. New buybacks from major Russian issuers can also mend the situation, he adds.

The Russian market can close the drop by the year-end if political risks’ weakening is supported by a high level of the global risk appetite of investors and comfortable commodity prices, BCS Investment World believes.

According to Freedom Finance, the RTS Index will recover to 1,900 points in about five-seven months, provided that geopolitical risks go down and the market reverses.