The increase in quotes of Russian shares may continue - experts. Top 7 reasons why stocks rise on the stock exchange What drives stocks to rise

MOSCOW, March 28 - RIA Novosti. Russian stock indicators rose on the last trading day of the week after the news that the international rating agency Moody's may raise the rating of Russian government securities. Analysts predict moderate growth in the medium term.

As a result of trading on Friday, the MICEX index strengthened by 0.57% - to the level of 1627.87 points. The RTS index rose by 0.95% and closed at 2049.40 points.

Shares of Gazprom by the end of the trading day rose by 1.19% on the RTS and by 0.61% on the MICEX, Rosneft - by 3.31% and 3.12%, respectively, LUKOIL - by 2.68% and 2.29%, Rostelecom - by 0.85% and 0.46%, Sberbank - by 0.32% and 1.10%. Quotations of RAO "UES of Russia" securities fell by 3.63% on the RTS and by 4.66% on the MICEX.

As Sergei Belov, asset manager at the Finam investment company, notes, the growth of Russian shares on Friday is largely due to the message that Moody's has placed the ratings of government securities of the Russian Federation on the list for review with the possibility of an increase.

According to him, the growth leaders on the last trading day of the week, as well as throughout the week, were shares of oil and gas sector companies, whose quotes increased on expectations of growth in the profitability of these enterprises due to a possible relaxation in their taxation.

"The papers of energy companies are a big disappointment, in particular, RAO "UES of Russia" is the leader of the fall, since the term for disbanding the company is already close," says Belov.

Making a forecast for the next week, the specialist notes that the domestic market is now "mostly standing still, and, most likely, in the near future, we should not expect significant changes in dynamics."

In turn, Alexander Fetisov, director of the analytical department of the East Commerce investment group, adds that only "ideological purchases" have been made on the Russian stock market for two months now. “At first it was the papers of metallurgical companies, then the shares of the communications sector, and now it is the turn of the oil industry,” he says. At the same time, the expert believes that the growth potential of the oil sector is already small.

Fetisov does not rule out that as early as next week, when the second quarter begins, the market may begin to grow due to "deferred demand" for Russian securities.

Analyzing the current situation on the market from the point of view of technical analysis, Alexander Poteshkin, an analyst at the Russian Financial Traditions investment company, notes that "the RTS index, contrary to expectations, managed to gain a foothold above 2037 points - a level that is a fairly significant level of resistance." "In addition, the demand of foreign investors is visible in the papers - the dynamics of ADRs is positive for many companies, in particular for Lukoil and Rosneft," he adds.

Thus, the expert predicts, while maintaining a moderately positive or at least neutral external background, the Russian market is able to reach higher levels in the medium term.

What do you need to know to successfully predict the value of a stock? After reading this material, you will know the answer.

To people who first encounter stocks, it may seem that a variety of unrelated factors influence their value. All this creates a sense of complexity and incomprehensibility. Fans of "technical analysis" add fuel to the fire. There is an unconfirmed hypothesis that technical analysis can predict the future behavior of stock prices based on past data. We want to help you understand what are the simple fundamental reasons that affect the value of shares, and offer a certain system that allows you to "sort it all out" and navigate the news flow.

Let's start from the stove. The goal of any business is profit. And stocks are just a way to participate or own a business. Businessmen are not altruists, but very pragmatic people. Therefore, the first most important factor in the value of shares is the profit that the company earns.

Here is the first key to understanding. Any news of a global nature can be considered from the point of view of its impact on the profits of companies. If it positively affects the profits of companies, then this will create prerequisites for market growth. If the news is industry-specific, such as an increase in fertilizer prices, then this will have a positive impact on the share prices of companies producing fertilizers. If the news concerns a specific company, for example, it was possible to conclude a major contract, then it is obvious that this will only concern the value of the shares of this company.

But profit is not the only indicator on which the share price depends. Imagine two companies in the same industry earning roughly the same profit. But the shares of the first company are actively traded on the stock exchange, the company adheres to high standards of corporate governance (CG) - respects the rights of shareholders. And the second, on the contrary, has repeatedly violated them, and its shares are difficult to buy and even more difficult to sell. Q: Which company's shares are more likely to be bought by investors? The answer is obvious - of course, the first.

There is such a convenient P / E indicator. P is Price, that is, the share price (or rather, the total value of all the company's shares - capitalization), and E is Earnings, that is, the company's profit. The meaning of this indicator is very simple - how much annual profit is the share worth, or, in other words, how many years will the investment in the share pay off.

Let's go back to the two companies example. We agreed that E (profit) is the same for them. But the shares of the first company investors will be more willing to buy, and the second will be avoided. This will lead to an increase in the prices of the shares of the first company and a decrease in the prices of the shares of the second. As a result, the P/E ratios of these companies will also change. Let's say the P/E of the first is 10, and the P/E of the second is 5.

At first glance, in terms of P / E, the second company is more interesting - investments in its shares will pay off in 5 years, and investments in the first only in 10. But this fact can be looked at differently. Investors are so loyal to the first company that they are ready to invest in it with a return of 10% per year and avoid the second so much that they are not attracted by a return of 20% per year, because due to risks this return may not be. An analogy with banks is appropriate - most depositors choose a bank not for the size of the promised interest, but for reliability.

Thus, we have found the second key factor influencing the stock price. This is the minimum return that investors want to receive by investing in stocks, or scientifically - the "discount rate". The influence of these two factors can be expressed by a simple formula.

If this yield is too low, for example, below a bank deposit, this means that the share is too expensive, and it is easier for an investor to invest in a bank without taking the risks of shares.

The factors that influence the returns required by investors are known, and there are not many of them. First of all, it is the general level of interest rates in the economy. It is determined by the level of deposit and lending rates, inflation, the refinancing rate of the Central Bank. This indicator is common for the entire economy. If the general level of rates rises, then the return required by investors rises and stock prices fall in general.

There are industry indicators that affect the return required from investments in the shares of companies in the industry. For example, oil prices are subject to large fluctuations. When investing in oil stocks, investors usually want a higher return than from stocks of companies that mine precious metals.

Of course, much depends on the individual characteristics of the company - its credit quality (the willingness of banks to lend), the level of liquidity of shares - if the shares are actively traded on the stock exchange, they are easy to buy and sell. If the company behaves correctly in relation to minority shareholders, this also affects the reduction in the discount rate and the possible increase in the market value of shares.

Market value of shares - withdrawal

At any given moment, many different factors can affect the value of a stock. But in the long term, it is the size of the profit received and the level of return required by investors (discount rate) that have a key impact on the value. To successfully predict stock prices, it is necessary to analyze how the company's profit and discount rate will change in the future.

We are glad to welcome our readers to a new article. Especially for you, we have selected an interesting topic - the pricing policy for (shares). As a rule, novice traders who are faced with the purchase of company shares for the first time mistakenly believe that factors that have no connection with each other influence the formation of the value of issuers' securities. This is fundamentally wrong.

What determines the stock prices of companies?

• There are two companies operating in the same industry, receiving the same quarterly results.
• The first firm respects the rights of shareholders by adhering to advanced standards in corporate governance.
• The second company constantly violates them.

P/E ratio

• No. 1 will have constant investments from investors (despite the yield of 10% per annum).
• No. 2 is not attractive for investment with its 20% profit.

The issuer and the psychological factor - a competent assessment of the company's shares

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Stock prices can change for many reasons. The quote is influenced by supply/demand, financial reports of companies, media news, rumors.

1. Supply and demand

2. Financial statements

3. Psychological factor

4. Mixed impact

Thus, the reasons why stock prices change are financial reports published by issuing companies, news, rumors and traders' expectations. Positive data pushes stocks higher, while negative data drives down prices.

They change according to the laws of supply and demand. If there are more people who want to buy shares (that is, they demand) more than those who want to sell them (that is, they form an offer), then the share price will rise. Conversely, if there are more people in the market who want to sell shares than they want to buy, then supply will exceed demand, and then the share price will fall.

Understanding the laws of supply and demand is not so difficult. What is really difficult is to understand why investors buy some stocks and avoid others. The answer to this question lies in the ability to understand what news should be considered good for the company, and what - bad. There are many ways to learn this, and no matter which investor you ask, they will almost always have a couple of ideas and strategies of their own.

According to the generally accepted point of view, the dynamics of shares depends on the perceptions of investors about the real value of the company. However, one should not put an equal sign between the value of the company and the price of its shares. The value of a company is its market capitalization, which is equal to the price of one share multiplied by the number of all shares traded on the exchange.

For example, a company that lists 1 million shares, each trading at $100, is worth less than a company that lists 5 million shares, each trading at $50 ($100 x 1 million = $100 million, and $50 x 5 million = $250 million).

Finally, in order to completely confuse, we must also keep in mind that the stock price reflects not only the value of the company today, but also the expectations of investors regarding the growth of this indicator in the future.

The key factor that determines the value of a company is its earnings. Income is the profit of the company, without which no business can exist in the long run. If you think about it, it's very logical. A company that does not know how to make money will not stay afloat for long. Public companies are required to publish income statements four times a year (that is, once a quarter).

During such periods, often referred to as corporate reporting season, Wall Street financiers monitor any market movements. If a company's performance exceeds investors' expectations, the stock price soars. But if the company does not live up to expectations (i.e., its results are worse than expected), then the stock falls in price.

Of course, the attitude of investors towards certain shares (which, in turn, determines their price) depends not only on income. It would be too easy! For example, during the Internet boom, many technology firms grew to billions of dollars in capitalization, and none of them could earn even the most modest profit. As we know, this did not last long, and very soon the value of these companies again fell dozens of times.

And yet, the fact that stock prices did change proves that not only the company's profits but also a number of other factors influence the price. Investors have developed hundreds of such variables, ratios and indices.

Some you may have already heard about (for example, the price / earnings ratio), while others are so complex that they scare even their names: take, for example, the Chaikin oscillator or the convergence / divergence of moving averages.

So what does the stock price depend on? Perhaps the most correct answer would be that no one knows for sure. Some believe that it is impossible to predict the change in rates, while others are sure that the charts and analysis of the previous price dynamics will allow you to calculate the right moment for both selling and buying. The only thing we are certain of is that stock prices are extremely volatile and can change in the blink of an eye.

In addition, sometimes companies make their shares cheaper - with the help of a split.

Split - an increase in the number of shares by dividing them in a certain proportion. As a result of the split, the number of shares increases, the value decreases, and the capitalization of the company remains the same.

For example, in a 2-to-1 split, the investor's number of shares is doubled and the value is halved: two new shares are priced at one before the split.

Suppose a company has issued 10 million shares of stock. They are currently listed at $40 each. Thus, the total capitalization is 400 million dollars ($40 * 10 million shares = 400 million). The company decides to do a 2-for-1 split. For each available share, the investor receives one more directly to the brokerage account. Now he has twice as many securities, but their value has fallen by 50% - from $40 to $20. Note that the capitalization remains the same ($20*20 million = 400 million). The real value of the company has not changed at all.

Here is the minimum you should know about the stock price:

1. At its most basic level, the price of a stock is determined by supply and demand.
2. The price of one share, multiplied by the total number of shares traded on the exchange, is equal to the value of the company (or its market capitalization).
3. In theory, an investor's valuation of a given company depends on its earnings, but there are other indicators that investors use to predict price movements. Remember: in the end, it is the expectations, sentiments, and personal assessments of investors that determine the price of a stock.
4. There are many theories that try to explain why stock prices move the way they do and not the other way. But, unfortunately, there is no theory that could explain everything.