MOSCOW: On Tuesday, the Russian Rouble strengthened toward 60 versus the dollar, continuing to be supported by capital controls and strong oil prices, which are Russia's main export. Stock indexes, meanwhile, were neutral as the market lacked momentum. The rouble was trading at 60.40 against the dollar during morning session, up 0.6 percent; it had been fluctuating daily between 59 and 62.
The rouble strengthened 1.2 percent to 61.48 against the euro, a significant improvement above the record low of 132.42 it set days after Moscow pushed tens of thousands of troops into Ukraine on February 24. The currency with the best performance is the rouble.
The dearth of news catalysts and the fact that the month-long tax payment season, which often drives up demand for the currency, won't begin until later in August, however, suggest that the rouble may steadily fall in the near future, as per a note from a Promsvyazbank analyst.
The MOEX Russian index, which is based on the rouble, was down 0.3 percent at 2,083.1 points, while the dollar-denominated RTS index increased by 0.3 percent to 1,086.7 points.
"The 15th of August, with the cancellation of depositary receipts and the possibility of seller overhang, is a crucial day. In this climate, buyers will wait-and-see and monitor stocks for potential price declines "cited by BCS Global Markets. In an effort to lessen foreign ownership of these companies amid Western sanctions, depositary receipts (GDRs) of Russian enterprises that were traded on foreign exchanges and stored in Russian depositories would automatically convert into shares on the Moscow Exchange starting on August 15.
Later this year, when the Moscow Exchange welcomes investors from supposedly friendly nations, market activity may grow. However, it was announced late last week that the verdict would only apply to the derivatives market and not the primary stock market. It was intended to take effect on Monday.
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