Russian stocks opened higher on Thursday, paring some of their losses for the previous three days as investors expected a rate cut from the European Central Bank and concrete solutions at this week’s EU summit to defuse the eurozone debt crisis.
European leaders are meeting later on Thursday to push for deeper fiscal integration as proposed by the eurozone’s leading economies, such as Germany and France, which might require changes to the EU basic treaties to legislatively seal possible spending targets for eurozone countries in a bid to cut their debt levels and restore investor confidence.
The key proposal is to work out a mechanism for enforcing budgetary discipline with automatic penalties for eurozone countries that fail to comply with their spending targets.
Analysts also expect the European Central Bank to cut its key interest rate by 0.25 percentage points to 1 percent to stimulate lending and spur economic growth.
As of 11:43 a.m. Moscow time (07:43 GMT), the ruble-denominated MICEX index rose 0.97 percent to 1,462.48 points while the dollar-denominated RTS gained 1.05 percent to 1,483.16 points.
The ruble fell by 4 kopecks against the U.S. dollar to 31.2308 and by 4 kopecks against the euro to 41.8688. The value of the bi-currency basket comprising $0.55 and 0.45 euros edged up 1 kopeck to 36.0543.