MOSCOW: The Russian stock market rose in early trade on Monday, stepping away from its lowest levels since October after the country's second biggest oil producer Lukoil reported strong results thanks to a recovery in oil prices.
A lack of rouble liquidity limited gains for the local currency on the last tax payment day in May, while prices of Russian Eurobonds were steady as global trading activity was quiet because of the US holiday.
The rise in the stock market largely reflected easing concerns about Greece's exit from the euro zone after weekend opinion polls showed Greek conservatives had regained a lead that would allow the formation of a pro-bailout government.
The dollar-traded RTS index rose by 1.4 percent to 1,290.8 points by 0730 GMT and the rouble-based MICEX climbed 1.2 percent to 1,2.97.3, extending gains from the seven-month low of 1,241.6 touched last week.
Shares in Lukoil slightly outperformed the market by rising 1.5 percent after the company reported a bigger-than-expected net profit for the first quarter.
In the interbank market, overnight rouble rates reached their highest level since late March of 5.85 percent, reflecting the need to meet monthly tax duties, with income tax to be paid by the end of the day.
The rouble firmed 0.5 percent to 31.87 against the dollar and shed 0.1 percent to 40.10 versus the broadly stronger euro.
"We think the rouble has a chance to shore up its position. The macroeconomic backdrop should be relatively calm due to the US holiday, while in Russia the May tax payment period is coming to an end, spurring demand for liquidity," Ivan Sinelnikov, an analyst at Gazprombank, said in a note.
"Ongoing volatility in currency rates does not carry any evidence of a serious devaluation in the rouble. The Bank of Russia has not set a target to maintain the national currency rate at a particular level."
Versus the euro-dollar basket, comprised of 0.55 dollars and 0.45 euros, the rouble firmed 0.2 percent to 35.38.
The central bank keeps the rouble within a floating band against the euro-dollar basket and gradually widens it to lower its own presence in the market and to allow the rouble a greater flexibility in the course of switching to inflation targeting policy from exchange rate targeting.
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