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Rouble Rallies on MOEX, Stocks Up after new Sanctions

April 7 (Reuters) - The Russian rouble firmed sharply in Moscow trade on Thursday to levels last seen before Russia sent tens of thousands of soliders to Ukraine, while stocks indexes jumped higher, shrugging off a new round of sweeping western sanctions.

At 0724 GMT, the rouble was 5.8% higher at 75.30 against the dollar after briefly touching 74.2625, its strongest level since Feb. 11.

"Even though the rouble looks overheated from a technical point of view, its strengthening can remain in place today," Promsvyazbank analysts said in a note.

Moves in the rouble were jittery and trading volumes on the Moscow Exchange were small compared with levels seen before Russia started what it calls "a special military operation" in Ukraine on Feb. 24.

The rouble recently has been steered by mandatory conversion of dollar and euro revenues by export-focused companies, while demand for forex has been limited by capital controls that the central bank imposed as the rouble crashed to record lows in March.

Against the euro, the rouble firmed more than 5% to 82.29 after touching its strongest level since October of 80.8375.

On the interbank market the rouble was weaker, trading at around 80 to the dollar , while banks offered to sell euros at 89.40 roubles and were ready to buy them at 83.94 roubles .

The Russian currency also shrugged off fears that Russia was edging closer to a potential default on its international debt as it paid dollar bondholders in roubles and said it would continue to do so as long as its foreign exchange reserves were blocked by sanctions. 

On the stock market, the rouble-based MOEX Russian index climbed 0.8% higher at 2,631.8 after falling the day before when shares took a hit from new sanctions.

The United States on Wednesday announced a new round of penalties targeting Russian financial institutions, as well as Kremlin officials and their family members. 

The dollar-denominated RTS index rose 5.2% to 1,088.9 points, its highest since Feb. 22.

Reporting by Reuters

Source: Reuters

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