Russia’s stock exchanges soared by more than 20 per cent yesterday in frenetic trading that was interrupted twice by suspensions imposed by regulators.

Trading was halted within 35 minutes after the rouble-denominated Micex exchange reopened following a two-day closure and as share prices leapt by 18 per cent.

The dollar-denominated RTS index also suspended business when it rose 14 per cent as buyers returned to the market in response to the Government’s injection of billions of pounds into the financial system.

The fourth suspension of trading in as many days was triggered by technical limits on the permitted speed of share price increases. Both exchanges reopened after an hour and continued their upward surge, prompting a second temporary suspension.

By the close of trading, the Micex had risen by a record 28.7 per cent to 1,098.9 points, while the RTS ended 22.4 per cent higher at 1,295.9. Both indexes have lost more than half their value since their peak in May.

Banking and energy shares, which had been pummelled during the week, rebounded strongly. The state-controlled VTB Bank rose 60 per cent in value on the Micex exchange, while shares in Rosneft, the oil giant, leapt by 45 per cent.

Andrei Sharonov, managing director of Troika Dialog, one of Russia’s leading investment banks, said that the markets remained vulnerable, despite the increases. “The fact that trading is better today does not mean the global situation is better and that the factors behind the crisis have gone away,” Mr Sharonov, a former deputy economy minister, said at an investment forum in the Black Sea resort of Sochi.

“I don’t think anyone would say the market has got over all of its problems. The factors that were causing the market falls are still there.”

On Tuesday the two markets suffered their worst one-day losses since Russia defaulted on its foreign debt in 1998. The sinking price of oil and concerns over the political fallout from last month’s war with Georgia added to the credit crunch-induced turmoil.

Regulators ordered the exchanges to close as the Government put together a package of measures to flood the banking system with liquidity. President Medvedev ordered ministers to inject 500 billion roubles (£11.1 billion) into the markets from the State’s budget and pledged “all necessary support” for the financial system.

Alexei Kudrin, the Finance Minister, also tried to bolster confidence by announcing that the State was ready to buy shares using up to $20 billion of government funds if markets did not stabilise. He said yesterday that the Government would buy shares mainly in state companies such as Gazprom and would sell at a profit later on.

Vladimir Putin, the Prime Minister, also talked up confidence, telling foreign investors in Sochi that Russia’s huge foreign exchange reserves of $550 billion were enough to support the financial system and defend the value of the rouble. The Government pumped $44 billion (£24.45 billion) into the banking system this week and cut reserve requirements by four percentage points to release 300 billion roubles in bank funds.

Mr Kudrin also said that a cut in export duties for oil companies would help them to deal with the fall in world prices. In all, the State’s intervention in Russia’s financial markets came to more than $130 billion.

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