UPDATE 1-Sberbank leads Russian stocks higher, rouble touches 2-month low

Tue Nov 12, 2013 9:07am EST

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Nov 12 (Reuters) - Russian stocks rose on Tuesday, with Sberbank outperforming after the state-controlled bank envisaged a doubling of assets and earnings in the next five years.

At 1257 GMT, the country's biggest bank added 2 percent versus a 0.2 percent gain before it announced its 2019 strategy.

The dollar-denominated RTS was up 0.6 percent at 1,437 points. The rouble-traded MICEX was 1.1 percent higher at 1,500 points, edging up from five-week lows as profit-taking in the most-liquid stocks subsided.

Gazprom added 1.4 percent as JP Morgan raised its rating for Russia's chief gas producer to overweight. Gazprom is due to release its Q2 earnings under international standards on Thursday.

An anticipated gas contract with China, switching the basis of dividend payouts to international financial standards and more efficient investments should lead to a re-rating of the stock, JP Morgan said in a note to clients.

Investors also remained focused on a gas pricing dispute between Ukraine and Russia.

Depositary receipts in Russia's second-biggest food retailer X5 jumped 5 percent in London after it reported a nearly six-fold year-on-year increase in third-quarter net profit.

The rouble weakened to fresh two-month lows on Tuesday and treasury bond yields rose on renewed speculation about when the U.S. Federal Reserve will start to trim its stimulus programme. That prospect is hurting assets of emerging markets, which have benefited from cheap money unleashed by U.S. stimulus.

The rouble was down 0.2 percent at 32.86 versus the dollar, moving close to the psychologically important 33 level, which it has not touched since Sept. 10.

The rouble was also down 0.2 percent against the euro at 44.07. That left Russia's currency weaker by the same margin at 37.91 against its dollar-euro basket.

"After strong payrolls data (in the United States), emerging market currencies look weak versus the dollar, while the rouble performs even better than some other currencies," said Mikhail Palei, a dealer at VTB Capital, referring to data published on Friday showing U.S. employers added many more new jobs than forecast.

The rouble has a chance to weaken towards 33.5 per dollar because of concerns about the end of U.S. monetary stimulus, he added.

The yield on Russia's 10-year treasury benchmark rose 11 basis points to 7.58 percent - the highest since Sept. 10. The spread between Russian sovereign debt and U.S. Treasuries widened by 2 basis points to 220 bps.

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