It is mainly due to the fluctuating prices on the global raw-material markets that the Russian stock markets find themselves in a bit of a downfall. Last Wednesday, for example, oil was sold at $50 per barrel. The success of the world’s stock markets, however, might act as the stabilizing factor for the Russian ones. RTS share index came to 1,808.8 points at the close of business on January 18, 2007, which means it’s only gone up .5 points within a week; MICEX share index reached 3,133.6 points.

The reason why the global oil prices are going down is OPEC’s failing to keep its liabilities in terms of cutting down on oil production. According to Bloomberg, OPEC exceeded its limit by 385 barrels daily last December. The organization’s next meeting is only going to take place on March 15, 2007, which makes its future policies even less clear. Up to then, increased volatility is to be expected on the oil market and, consequently, on the Russian stock market.

President Vladimir Putin announced on January 18 that all of Russia’s energy-related cooperation with other countries was to become market-based, which shows that the government is committed to liberalizing the electricity market as rapidly as possible. This trend is likely to have a positive impact on the shares of power-engineering enterprises.

In terms of technical analysis, the market can be referred to as neutral; its volatility is only average, and it is difficult to say what trends are going to dominate the market in the future. Given the current situation, the Russian shares might keep going down, especially now when the data on the U.S. oil stock (which went up 2.15% last week) have been published, says the spokesperson for SKB-Bank.