The ruble rose to a one-month high against the euro as Russian markets regained ground
LONDON (Reuters) – The Russian ruble rose to a one-month high against the euro on Thursday and rose above 60 against the dollar as Russian markets regained gains after the Kremlin ordered a partial military mobilization.
Russian stock markets saw high volatility in the previous two sessions, plummeting as President Vladimir Putin said he had signed a decree on a partial military mobilization, leading to a significant escalation of what Russia calls its “special military operation” in Ukraine.
He also warned that Moscow would respond with the full force of its huge arsenal if the West continued what he called its “nuclear blackmail.”
By 1029 GMT, the ruble, which briefly fell to its lowest level since early July in the previous session, was 1.5% stronger against the dollar at 59.80 and rose 2.3% to trade at 58.78 against the euro, breaking the 59 threshold for the first. Time since August 19.
It rose 1.6 percent against the yuan to 8,439.
Stocks continued their recovery, with Russia’s benchmark MOEX index rebounding more from its lowest level since February 24, the day Russia sent troops to Ukraine, which hit on Wednesday.
Phyllis Capital said in a note that there may be some corrective buying despite geopolitics and hawkish US Federal Reserve stoking fears of a global economic slowdown that are still pending in the market.
The dollar-denominated RTS index rose 3.7% to 1147.6 points. The Russian ruble-based MOEX index rose 2.3 percent to 2,178.8 points.
Among the market drivers are expectations that Gazprom will pay interim dividends. Deputy Finance Minister Alexei Moiseev told a banking forum in Kazan that he expected the Russian energy giant to fulfill its promise to pay.
Gazprom shares rose 4.9%, outperforming the broader market.
Gazprom’s dividend is a sensitive issue for the market, which was disappointed by the decision in June of the Russian government – Gazprom’s main shareholder – not to pay a dividend on last year’s results.
“The Gazprom shareholder meeting is now the main near-term driver of the stock and the market as a whole,” BCS Express said.
(Reporting by Felix Light; Editing by Emilia Sithole Mataris)
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