MOSCOW: The Russian stock markets rose in light trade on Monday, supported by strong oil prices and waning political tensions, while the rouble held steady after advancing 2.4 percent versus the dollar in the previous week.
The dollar-based RTS index and its rouble-traded peer MICEX both climbed 0.8 percent by 0732 GMT, remaining at levels seen since mid-December.
Political tensions, sparked by massive protests against the victory of the ruling party United Russia at Dec. 4 parliamentary elections, eased after tens of thousands of people again went onto streets of Moscow on Saturday but failed to concur on further constructive steps to continue disputing the vote results.
"Given the more evident optimism and closing strength on Wall Street ahead of the Christmas break, and the uneventful protest on Saturday, Moscow's bourses should trade better over the first part of this week at least," analysts at Troika Dialog said in a note.
Shares in the country's No.1 and No.2 oil and gas companies Gazprom and Lukoil had the most pronounced positive impact on indexes by gaining 0.7 and 0.54 percent respectively, buoyed by oil prices at around $108 per barrel.
The rouble was virtually unchanged at 31.21 against the dollar and eased 0.3 percent to 40.77 versus the euro after posting its strongest weekly gain since May, 2010 in five days to Dec 23.
"Everything will depend on the willingness of banks' clients to sell or buy currencies in big amounts, understanding that their orders could result in elevated volatility in conditions of low liquidity," said a dealer at a major Russian bank in Moscow.
Versus the euro-dollar basket, the rouble gave up 0.1 percent to 35.51 , trading within a range of 34.70-35.70 where the central bank does not carry out any forex interventions to limit the rouble's fluctuations.
Technical analysis suggests that the basket's support now lies at 35.36, the lower boundary of Bollinger bands and then at 35.26, 50 percent retracement of an upside move from 2011 low of 32.86 hit in late July to this year's high of 37,65 touched in early October.
Payments of mineral extraction tax and excises on Monday should bolster the rouble by prompting exporters to convert foreign currencies and also by keeping monetary conditions tight.
Interbank overnight lending rates stood at 5.5 percent, where they have been hovering for the past three months, above levels of below 4.0 percent seen before the liquidity squeeze emerged in mid-September.
The central bank surprised the market on Friday by raising its deposit rate by 25 basis points to 4.00 percent and by cutting the refinancing rate to 8.00 percent from 8.25 percent.
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