Interview with Erik DePoy
Russia Today: It has been a volatile week in Russia, in Russian markets. What factors have been at play? What has been a trigger here?
Eric DePoy: Basically we came into the week just in a very nervous mood. Again last week, in the U.S. market, it was the worst performance in about five years. So for Russian investors – we have been to this before when volatility strikes the U.S. market and by extension global markets. Russia definitely feels that fact. So, you know, we had basically a tracking mode this week: when the U.S was up – Russia was up, when the U.S. was down – we were down too. But we were very much watching external markets, I suppose, to anything going on domestically.
RT: What sectors have held up best against this global downturn?
E.D.: Well, in general, the action's been confined to the blue chips stocks. This covers sectors of oil, gas, financials metals. But basically we saw straightened course in the oil stocks, again the oil price has been very high. Also we have seen bids for steel names. Now, again this capitalises on the Russian construction boom, again there is this thing with the Sochi Olympics. Russia's very strong domestic macroeconomic stories, really catalysed interest in the steel stocks and construction names.
RT: So we can just concentrate on the oil prices now. They eased off their highs for week but the markets are still sensitive. What is your outlook?
E.D.: Well, basically the oil prices surprise a lot of people now. Again this time last year we had oil spiking very high in response to the violence in Lebanon. This year it seems to be more a realisation that global demand for oil is very strong. We still have the threat of a hurricane coming up especially in the next couple of months. And again the U.S. driving season. So, although there is a lot of supply on the global market with oil there’s still huge demand and oil traders have been pushing up the oil price so that’s definitely created a bid for the oil stocks here.