Russian stocks hit new troughs

Russia's President Dmitry Medvedev (R) speaks during an emergency meeting to fight the global financial crisis, in Moscow October 7, 2008.

MOSCOW (Reuters) - Russia's stocks set fresh three-year lows, while the central bank sold an estimated $4 billion to prop up the rouble on Tuesday, as news of new Russian anti-crisis measures failed to lift sentiment.

President Dmitry Medvedev announced that the state would give key Russian banks subordinated credit totaling 950 billion roubles ($36.69 billion).

The news initially cheered Moscow's bourses when trade opened after a 2-1/2 delay ordered by the Russian markets watchdog following the steepness of Monday's sell off.

But neither the fresh batch of market rescue measures -- on top of the $180 billion package already announced -- nor the recovery in the oil prices was enough to cause a lasting change in sentiment on Russian markets.

"The measures are certainly having a positive impact on the margin -- every time they announce more measures you see the market rebound but ultimately it is not in the hands of the domestic authorities," said Ivailo Vesselinov, senior economist at Dresdner Kleinwort in London.

"For the time being, given the uncertainty with regards to the banking sector everywhere, there is so much uncertainty and so much risk aversion that there is no appetite for anyone to consider even markets such as Russia which appear to be oversold."

Russia's benchmark RTS index fell as low as 825.03 points, its lowest since August 2005 and extending Monday's 19 percent slump which was the worst daily showing in its 13-year history.

The MICEX index, an indicator of more liquid rouble-denominated trade, dipped to 691.53 points, the lowest since July 2005.

Illustrating Russian markets' dependency on global news, both RTS and MICEX trimmed losses after the U.S. Federal Reserve announced the creation of a special-purpose facility to begin buying commercial paper in yet another emergency move aimed at calming financial markets.

By 1335 GMT, RTS was down 0.9 percent 858.55 and MICEX was down 1.2 percent at 742.49.

Moscow's bourses have been hit by the loss of confidence in the global financial sector and broad risk aversion, which added to an already Russia-negative sentiment in the wake of the military conflict with Georgia and the subsequent souring of relations with the West.

"The problems have not gone away anywhere, neither in the banking system nor in the real economy," UniCredit analyst Vladimir Osakovsky said.

The rouble closed at the central bank-defended 30.40 level against a euro-dollar basket, with dealers estimating that the central bank had sold $4 billion on Tuesday, following interventions of $5 billion on Monday.

Supporting the rouble has been a major drain on Russia's gold and forex reserves, which fell $25.57 billion last month to $556.07 billion according to data released on Tuesday.

Overnight money market rates rose to one-week highs, suggesting that liquidity remains tight.

(Reporting by Andrei Ostroukh, Toni Vorobyova and Polina Vorobieva; Editing by Jon Loades-Carter)