Stocks Rebound on Higher Oil Price

VedomostiShares in Sberbank, which raised $8 billion in a 2007 share sale, fell for a third day running on fears of bond losses.
Russia's MICEX Index on Wednesday rebounded from the lowest level in almost two years as higher oil prices lifted shares of energy producers.

LUKoil advanced for the first time in four days after crude climbed above $119 a barrel. Sberbank declined on speculation it will face losses from government-denominated ruble bonds in its portfolio.

The ruble-denominated MICEX added 0.8 percent to 1,302.58 at the close, after earlier falling as much as 2.2 percent. The dollar-denominated RTS Index increased 0.6 percent to 1,589.05.

LUKoil added 48.74 rubles, or 2.9 percent, to 1,751.48 rubles on Wednesday. Gazprom climbed 1.1 percent to 233.27 rubles.

Crude oil for October delivery rose as much as 2.9 percent to $119.63 per barrel in New York trading.

RusHydro climbed for the first time in five days, increasing 0.053 ruble, or 3.6 percent, to 1.512 rubles. The RTS Index said it will move the stock to its "A" list.

Sberbank fell 0.51 rubles, or 0.9 percent, to 55.50 rubles, a third day of declines totaling 12 percent. The bank may face losses on the more than $10 billion it holds in government ruble-denominated bonds, according to Natalya Orlova, chief economist at Alfa Bank.

The government's ruble bonds have declined since Aug. 8.

"The implied equity risk premium in Russia has risen significantly over the last several weeks and has reached an estimated 10 percent -- levels not seen since 2005,'' UBS said in a note to investors.

The Swiss bank cut its price estimates for 74 Russian stocks, citing Russia's decision Tuesday to recognize the independence of South Ossetia and Abkhazia.