LONDON (CNNfn) - Russian equities posted strong gains for second straight day Thursday as domestic and overseas investors moved in following the resignation of president Boris Yeltsin and transfer of power to Vladimir Putin on Dec. 31.|
The benchmark RTS-I index in Moscow climbed 3.4 percent to 186.16 in morning trading, building on a 2.1 percent advance Wednesday, the first full day of trading since Yeltsin unexpectedly resigned.
The index surged 17 percent to a 1999 high in a shortened trading day on Dec. 31, but analysts said more sharp gains could be expected next week when international institutions return to the market in force.
Energy stocks pulled the market higher Thursday, building on increases of between 30 and 60 percent in prices of ADRs in heavyweights such as Lukoil, Gazprom and Tatneft.
"It’s a good mix of domestic trading and overseas institutions who like the idea that political instability is over,” said David Longmuir, head of Russian trading at Renaissance Capital in London.
He said the transfer of power to prime minister Putin and the decision to bring forward presidential elections by three months to Mar. 26 were encouraging buyers. "Market participants are projecting their hopes onto Putin.”